Our window on the green universe! The Bank of Italy marks Earth Hour with a new explainer on sustainable finance
Earth Hour is a global grassroots movement that started in 2007 with a symbolic one-hour-long lights-out event. It aims to unite ordinary people, institutions and businesses in their shared desire to deliver a more sustainable future for the world and to meet the climate change challenge.
This year, on 26 March from 20:30 to 21:30, the Bank of Italy will again switch off the lights on the façades of all of its buildings. To mark the occasion, we are also publishing a new explainer on our website on sustainable finance issues. The English version will be available soon.
What are the risks posed by climate change and what commitments have countries made to mitigate it? When can an investment be defined as sustainable? These are just some of the questions that we will seek to answer, explaining, for example, what ESG (Environmental, Social and Governance) scores are, why they are used to identify sustainable financial instruments, and what their limits are. We will also be looking at newer concepts such as greenwashing.
But why must financial education deal with sustainability in the first place? Because when it comes to investments, people must be empowered to make informed decisions about how to channel their savings. This means making investments which, in addition to generating income, have a positive impact on the environment and on the whole of society in the medium and long term.
This is why we need financial education projects and initiatives that offer a more comprehensive guide to personal finance management. In our new section on sustainable finance, the Bank of Italy is taking the first step on the road to doing just that. The aim is to boost the confidence of small savers and to raise awareness of how important it is for their investment choices to be based on transparent, high-quality and comprehensive information.
You can read more about the Bank of Italy's contribution to sustainable finance and investment on our website, where we describe the commitments we have made, as a central bank and supervisor, to analysing climate risk and sustainability issues and, as an institutional investor, to the principles and criteria that guide our actions in favour of a new model of sustainable growth.