Home / Europe / Germany / ESG / Sustainable Finance

Sustainable Finance

Back to ESG

In the European Green Deal, the European Union has committed to becoming the first climate-neutral economic area in the world by 2050. In the pursuit of this goal, net greenhouse gases are to be reduced by 55 percent below the 1990 level by 2030. For this to be achieved, more (private) capital needs to flow into climate-friendly projects and companies. The financial sector has a key role in the implementation of this plan: it must mobilise the resources for the necessary transformation of the real economy. 

The market is already developing rapidly. The main focus is on ESG and impact funds, green financial products, such as green bonds, as well as green and sustainability linked loans in the financing sector, amongst other things. 

The sustainable finance package of the EU which was already launched in 2018 is intended to create further incentives for environmentally friendly investments. Central measures are, in particular, the Taxonomy Regulation, the Disclosure Regulation (SFDR) and the integration of sustainability preferences into the MiFID II regime. We have provided a brief overview below:

Taxonomy Regulation

The Taxonomy Regulation defines which economic activities are sustainable and for the first time creates a legally binding standard for sustainable investment. The Taxonomy Regulation is the core of the sustainable finance legislative package and the centre of reference for a wide range of measures. The Taxonomy Regulation applies in the following contexts:

  • As a basis for issuers of green financial products or corporate bonds (e.g., European green bond standard),
  • Financial market participants who set up financial products in accordance with the Disclosure Regulation, e.g., portfolio management, investment funds, 
  • Undertakings that are obliged to publish so-called "non-financial statements" under the CSR Directive.

Disclosure Regulation

The Disclosure Regulation regulates company and product-related transparency requirements for financial market participants. Central pillars are:

  • Dealing with sustainability risks, 
  • Dealing with Principal Adverse Impacts, 
  • Classifying financial products according to their sustainability (Art. 8 and Art. 9).

Integration of sustainability preferences, MiFID II

With the amended Delegated Regulation (EU) 2017/565 on MiFID II, investment advisors and portfolio managers will be required to actively seek information on investors' sustainability preferences and recommend products that meet these. This extends the assessment of suitability, which has so far focused on return, risk and liquidity, to include the criterion of sustainability.

(Last updated: 30.01.2023)

Our Sustainable Finance team advises on the following topics: 

  • Green loans, social loans and sustainability-linked loans (including promissory note loans)
  • Green bonds, social bonds and sustainability-linked bonds 
  • ESG compliance
  • Sustainability-related disclosure obligations and implementation of further regulatory requirements 
  • Setting up ESG and impact funds 

We would be pleased to advise you on any issues around ESG regulatory proposals, in particular the Taxonomy Regulation, the Disclosure Regulation and MiFID II, and on general questions relating to sustainable finance. Please contact us.

Send us a message and we will get back to you.

Your message was sent.

Thank you for contacting us. We will get back to you soon.

Please check these fields.

By including your personal data on this form you agree to it being used in accordance with our Privacy Policy

sending...

Feed

05/03/2024
Plastics and packaging laws in Germany
1. What is the general legislative framework regulating packaging and plastic waste in your jurisdiction? Regulations for packaging waste are set out in the German Packaging Act (Ver­pack­ungs­ge­setz)...
Comparable
01/06/2022
CMS Next
What’s next? In a world of ever-ac­cel­er­at­ing change, staying ahead of the curve and knowing what’s next for your business or sector is essential. At CMS, we see ourselves not only as your legal advisers but also as your business partners. We work together with you to not only resolve current issues but to anticipate future challenges and innovate to meet them. With our latest publication, CMS Next, our experts will regularly offer you insights into and fresh perspectives on a range of issues that businesses have to deal with – from ESG agendas to restructuring after the pandemic or facing the digital transformation. We will also share with you more about the work that we are doing for our clients, helping them innovate, grow and mitigate risk. To be able to provide you with the best support, we immerse ourselves in your world to understand your legal needs and challenges. However, it is equally important that you know who we are and how we can work with you. So, we invite you to meet our experts and catch a glimpse of what is happening inside CMS. Enjoy reading this publication, which we will update regularly with new content. CMS Executive Team
04/04/2022
CMS Germany strengthens commitment to sustainability
Berlin – Sustainability is of key importance for international commercial law firm CMS Germany, both internally and in the services it provides to clients. Accordingly, it has now strengthened its commitment...
31/05/2021
CMS advises tech start-up AMPEERS ENERGY on investment by Austrian Bundesim­mob­i­li­engesell­schaft...
Munich – Austria’s federal real estate agency Bundesim­mob­i­li­engesell­schaft (BIG) is taking a 25.1% stake in German start-up AMPEERS ENERGY as part of a round of financing. AMPEERS is a SaaS specialist...
19/05/2021
CMS advises hep global GmbH on successful placing of green bond
Frankfurt/Main – hep global GmbH has successfully placed its 6.5% green bond 2021/2026, raising EUR 25 million. The international specialist for the development, realisation and operational management...
24/02/2021
CMS advises EnBW on investment by Commerz Real in portfolio of 14 onshore...
Stuttgart – EnBW Energie Baden-Württem­berg AG has sold 49.9% of the shares in a portfolio comprising 14 onshore wind farms with 47 wind turbines and total output of 133 MW to Commerz Real’s Klimavest...
01/02/2021
CMS advises PE investor Demeter on investment in software firm Cuculus
Stuttgart – Demeter, a major European private equity investor in the sustainability segment, has invested in Cuculus GmbH, a leader in the development of software solutions for critical in­fra­struc­ture...
24/09/2020
Green and Sustainable Finance
Sustainable investing is no longer a niche area - it is going mainstream and especially the issuance of green bonds has grown at a rapid pace in recent years, and this trend is showing no signs of slowing...
10/01/2020
CMS advises Telefónica Deutschland on conclusion of sus­tain­ab­il­ity-linked...
Frankfurt/Main – Telefónica Deutschland has become the first German tele­com­mu­nic­a­tions company to agree a sus­tain­ab­il­ity-linked loan of EUR 750 million through its subsidiary Telefónica Germany GmbH...