The Bank of Finland (BoF) is to put sustainable growth alongside economic stability at the core of its revised strategy, although there are notable gaps, particularly on climate change.
The BoF’s new mission and vision is to “foster a sustainable economy and stability,” with sustainable growth included as one of five goals. Governor Olli Rehn has said that the bank “is dedicated to building a sustainable economy and stability,” adding that the strategy responds to various challenges, including climate change.
However none of the bank’s five strategic priorities for 2021–2023 directly references climate change or sustainability. In addition, only one of nine operating principles relates to sustainability – a requirement to act “responsibly and in accordance with the principles of sustainable development.” This was addressed with new responsible investment principles that the bank will follow in managing its €11 billion own funds portfolio.
The BoF, a recent signatory to the UN-affiliated Principles for Responsible Investment (PRI), will focus on integrating ESG considerations into its traditional financial decision-making and will invest thematically, making fixed-income investments in green, social and sustainability bonds and bonds issued by development banks. The bank will also apply norm-based screening, specifying that it will not invest in the debt instruments of issuers that do not comply with the principles of corporate sustainability defined in the United Nations Global Compact.
Although headlined as a major integration of sustainability into the bank’s core strategy, in practice the sustainability component of this announcement only concerns the bank’s own funds and is largely a repetition of principles already outlined in the bank’s 2019 sustainability programme.
However the new strategy does refer to engaging in “constructive dialogue” in the Eurosystem, and “knowledge-based influencing” is included as a short term priority. If sustainability is now actually at the heart of the BoF’s mission and strategy, it may be in this dialogue and influence where it is most effectively expressed.
This page was last updated April 23, 2021
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