The Capital Markets Union is not a solution to fund the Green Deal

Reclaim Finance contends that the Capital Markets Union (CMU), as currently proposed, will not solve the EU's climate funding gap. The organization argues that the CMU's broad approach would benefit all sectors, including polluting industries, while simultaneously weakening prudential standards and supervisory mandates. Specifically, the document warns that the increased use of securitization under the CMU could facilitate lending to high-carbon activities and obscure associated risks unless strict 'green' definitions and barriers against fossil fuel financing are implemented.

• The European Union is currently failing to meet its climate targets for 2030, 2040, and 2050, partly due to a significant gap between the investment required for the green transition and the actual amount invested.
• Estimates for the additional annual investment needed for the EU to reach its 2030 climate target vary between 620 billion euros, according to the European Commission, and one trillion euros, according to the European Court of Auditors.
• The proposed Capital Markets Union (CMU) is criticized for lacking specific mechanisms to direct capital toward sustainable activities, meaning it would likely support polluting industries and increase global greenhouse gas emissions.
• The CMU proposal suggests relaxing supervisory mandates and prudential standards for European banks, which Reclaim Finance argues could increase climate-related financial risks while weakening the safeguards meant to absorb them.
• The use of securitization within the CMU package could increase lending capacity for heavily polluting activities and hide risks unless 'green' securitizations are clearly defined and fossil fuel development is explicitly excluded.

APA

Martin, L. (2024). The Capital Markets Union is not a solution to fund the Green Deal. Reclaim Finance. https://reclaimfinance.org/site/en/2024/10/07/the-capital-markets-union-is-not-a-solution-to-fund-the-green-deal/

Chicago

Martin, Léo. The Capital Markets Union is not a solution to fund the Green Deal. Reclaim Finance, 2024. https://reclaimfinance.org/site/en/2024/10/07/the-capital-markets-union-is-not-a-solution-to-fund-the-green-deal/.

Wikipedia

{{cite press release |last1=Martin |first1=Léo |title=The Capital Markets Union is not a solution to fund the Green Deal |publisher=Reclaim Finance |date=7 October 2024 |url=https://reclaimfinance.org/site/en/2024/10/07/the-capital-markets-union-is-not-a-solution-to-fund-the-green-deal/ |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@misc{martin2024capital, author = {Martin, Léo}, title = {{The Capital Markets Union is not a solution to fund the Green Deal}}, publisher = {Reclaim Finance}, year = {2024}, month = oct, url = {https://reclaimfinance.org/site/en/2024/10/07/the-capital-markets-union-is-not-a-solution-to-fund-the-green-deal/}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }