Employee financial well-being is a key determinant of performance and thus has a direct impact on the organization, 98 % of employers agree. Most importantly, employee financial health impacts turnover, as 53 % of employers indicate, engagement (62 %) and productivity (67 %). This is according to the "Future of Pay" study by HR services provider ADP. The Corona Crisis and the anticipated economic downturn are putting increasing focus on employee financial well-being and the challenges it poses for employers.

Measures that go beyond mere salary payments

The fact that economic well-being affects the overall well-being of employees and is therefore a pressing issue is recognized by the majority of European employers (76 %). 72 % of employers believe that they should take an interest in the financial situation of employees. Nearly two-thirds of companies (64 %) believe that offering financial tools, such as apps that provide insight into financial data or tools to budget and track money, help attract top talent.

Employees are also convinced of the importance of financial well-being. A large majority (59 %) of European employees believe employers should take an interest in this issue, and an almost equal share (62 %) would like to work for a company that actually cares about employees' financial situation. 30 % of employees say the availability of financial management support tools would impact their decision to accept a job. They consider this benefit to be as attractive as various off-cycle compensation opportunities or working in a home office.

Not only financial well-being, but demographic and generational trends and preferences in general are impacting workers' preferred method of compensation. For example, 68 % of Millennials would share personal data with payroll service providers to receive financial management support - an age group that will account for 75 % of all workers globally by 2025. Among Generation X, the willingness to share personal data is 52 % and among Baby Boomers, it is only 32 %.

The importance of financial well-being is increasing

According to Steven van Tuijl, General Manager Germany and Poland at ADP, it is time to focus on the financial well-being of employees: "It is clear that people with concerns about their financial situation are more prone to stress and even physical health problems. The current crisis situation and the threat of economic recession are increasing income concerns. Therefore, it is important that employers not only pay attention to the financial well-being of their employees, but also offer various compensation options to best support them in this area. The study shows that this was necessary even before the current crisis. But the urgency has increased."

www.de-adp.com

Bertrand Piccard gave the go-ahead for the hydrogen filling station in St. Gallen.By the end of 2020, public hydrogen filling stations will be in operation on the Lake Constance - Lake Geneva axis in St. Gallen (SG), Rümlang (ZH), Hunzenschwil (AG), Zofingen (AG), Bern (BE) and Crissier (VD). In its current issue (UP 2020_02), Umwelt Perspektiven reports in detail on the advantages of hydrogen-powered trucks. At the new hydrogen filling station in St. Gallen, green hydrogen is available for commercial vehicles (350 bar) and passenger cars (700 bar). Osterwalder St. Gallen AG is the first filling station to offer the green hydrogen with the designation H2 Zero. Colleagues from autosprint.ch were on site and have summarized the most important developments.

Unique achievement of the private sector

Bertrand Piccard: "What the Swiss private sector is creating is unique in the world. Some believed that the hydrogen industry was pure utopia. But Switzerland is proving that electrically powered commercial vehicles and passenger cars can be fueled with clean hydrogen and driven without CO2 emissions."

Electrically driven trucks
After a pilot phase lasting several years, the members of the H2 Mobility Switzerland promotional association and their partner companies are ramping up the new electric mobility system in Switzerland.
This enables CO2-free operation of electrically powered commercial vehicles and passenger cars that run on green hydrogen as an energy storage medium.

How the mobility system works
Hydrospider, Hyundai Hydrogen Mobility (HHM), the Förderverein H2 Mobilität Schweiz and H2 Energy are currently building zero-emission electromobility in Switzerland. The basis for this is provided by an ecosystem that unites various players in one system.

Every part of this cycle, from the energy source to production and use in the electric vehicle, functions without CO2 emissions.

Manufacture exclusively Switzerland
The closed cycle begins with the production of green hydrogen by Hydrospider AG. In advance, this takes place in a production plant at the Alpiq hydropower plant in Gösgen (SO).
The hydrogen is produced exclusively with the help of electricity from renewable energies (water, sun, wind) in Switzerland - and is therefore emission-free and climate-friendly. This is completely green hydrogen.

1600 fuel cell electric trucks
Hyundai Hydrogen Mobility AG imports up to 1600 fuel cell electric trucks by 2025. Hydrogen supply, construction of the commercial vehicles, infrastructure and filling station network for the first 50 Hyundai Xcient Fuel Cell trucks are prepared. The 36-ton trailer trucks are expected to be on Swiss roads before the end of 2020.
The members of the Förderverein H2 Mobilität Schweiz are deploying the commercial vehicles and setting up the nationwide refueling infrastructure with 350 bar and 700 bar (for commercial vehicles and passenger cars).

Advantages of hydrogen electromobility
Hyundai and Toyota already offer standard electric passenger cars in Switzerland that are fueled with hydrogen.
Advantages of hydrogen electromobility: local and independent production, zero-emission mobility (water vapor instead of exhaust fumes), electric motor propulsion (quiet and efficient), rapid refueling (compared with conventional vehicles), and a long range.
The future is already present these days.

h2mobilitaet.ch

All articles on the topics: Bertrand Piccard, H2 Mobility, Hyundai, Hydrogen

The study "Consumer Goods and Retail: How Sustainability is Fundamentally Changing Consumer Preferences" proves: Retailers and manufacturers have now internalized the benefits that sustainability has for their customer relationships: 77 percent say that sustainability leads to greater customer loyalty, while 63 percent confirm that it increases brand sales.

Despite the intention to be sustainable, however, there is a gap between what consumers think they know and what they actually understand about sustainability: 78 percent of consumers are unaware that it takes 1,000 liters of water to make one candy bar and 68 percent do not know that the average burger results in more emissions than a 15-kilometer SUV drive. Nearly 68 percent of consumers who purchased these products were willing to buy a more sustainable product once they understood the sustainability issues.

This means there is a need to provide consumers with more information on sustainability. This finding underscores the importance of brands driving the sustainability agenda.

Knowledge gaps on sustainability among consumers and companies

However, this knowledge gap also exists among retailers and manufacturers who believe their buyers know more than they do. Just over two in three executives (67 percent in Germany, 65 percent internationally) say their consumers know their sustainability initiatives very well. However, one in two consumers (46 percent in Germany, 49 percent internationally) say they have no information to verify product sustainability claims.

Almost half openly say they do not trust the sustainability claims of products (41 percent of Germans, and 44 percent of all respondents). In Switzerland, similar conditions apply as far as the benchmark market is concerned.

Most companies are only scratching the surface when it comes to sustainability

Specialized CPR organizations spend an average of 1.9 percent of their revenue on sustainability initiatives. The average investment is nearly $34 million by value, and they are reluctant to spend more - nearly 80 percent of organizations cite the impact on profit margins or cost overruns as a challenge in scaling sustainability initiatives. For nearly three in four organizations, other issues take priority, according to this study (see end of text).

Three in four (75 percent) of CPR organizations say they have a strategy, as well as the infrastructure and resources, to drive sustainability and circular economy efforts. However, when it comes to implementing effective company-wide initiatives, less than a quarter of organizations have succeeded. The most commonly scaled initiatives are fair labor policies and safe working conditions. Forty-eight percent of companies say they have reached some level in these areas. In contrast, sustainable IT, which is about reducing the carbon footprint of digital processes (e.g., energy efficiency in data centers), is increased by only 18 percent.

Although the pandemic has put a renewed focus on the circular economy, only 18 percent of executives have invested in circular economy initiatives and only 35 percent plan to invest in this area in the next three years.

Pia Heidenmark Cook, Chief Sustainability Officer at Ingka Group, which includes Ikea Germany, says: "I think one challenge that many organizations face is change management. Many organizations are under the impression that sustainability is more expensive. However, they don't realize that initiatives like waste reduction or energy efficiency reduce their operating costs. So I would say the main challenge that stands in the way of sustainability is change management - making the business case for why it makes sense and influencing and inspiring people to understand why it makes a difference."

The complete study is available for download here: https://www.capgemini.com/de-de/news/studie-herz-nachhaltigkeit-gluecklich-verbraucherpraeferenzen-veraendert/

About the study

The report, "Consumer Goods and Retail: How Sustainability is Fundamentally Changing Consumer Preferences," surveyed 7,500 consumers from the U.S., U.K., Sweden, Spain, France, India, Italy, the Netherlands and Germany (11 percent). In addition, 750 companies from the industry were surveyed (Germany: 12 percent), in addition to one-on-one interviews with numerous executives. More details on the methodology are also available in the appendix of the study.

Water is one of the key resources of the future: Many lowland regions around the world are dependent on inflows from mountain areas, not least because of the sharp increase in irrigation for agriculture. A study led by the University of Zurich quantifies this dependence for the first time by contrasting water supply and consumption in lowlands with inflows from mountains. Based on a high-resolution global model, the study provides detailed information around the globe on dependence on mountain water resources. The analyses were conducted over a large area using a regular grid and then compared for each river basin with an area of over 10,000 km2 . This allows very differentiated insights into the respective regional differences and peculiarities.

Dependence increases despite falling per capita consumption

"Until now, the focus has been mainly on river basins that originate in the high mountains of Asia," says Daniel Viviroli of the Institute of Geography at the University of Zurich. "But in many other regions, intensively farmed areas are also very dependent on water from mountainous areas. This is the case, for example, in the Middle East and North Africa, as well as in parts of North America, South America and Australia," adds the first author.

This dependence has increased massively since the 1960s - despite more efficient water use and declining per capita consumption. Whereas at that time only 7 percent of the lowland population was substantially dependent on contributions from the mountains, by the middle of this century this figure will have risen to 24 percent. This corresponds to about 1.5 billion people in the lowland areas. The focus is particularly on the catchment areas of the Ganges-Brahmaputra-Meghna, Yangtze and Indus rivers in Asia, the Nile and Niger in Africa, the Euphrates and Tigris in the Middle East and the Colorado in North America. For their calculations, the researchers assumed a medium scenario in terms of population growth and technological, economic and social development.

Functioning ecosystems and climate protection

"For the mountains to continue to serve as the Earth's water towers, sustainable development is needed. It should be a key interest of lowlanders to safeguard this function of the mountains," says Viviroli. For example, agricultural overuse should be prevented and functioning ecosystems ensured. In addition, climate protection plays a decisive role: due to rising temperatures, the melt water peaks from snow-covered mountains already occur several weeks earlier in some cases, making them less usable for summer agriculture. Adjustments to water management will therefore be necessary, and possibly also new infrastructure such as dams and canals.

"However, technical solutions go hand in hand with major ecological damage, and some rivers, such as the Indus, also have little potential for expansion," says Viviroli. For the future, it will be crucial that lowland and mountain regions work closely together, despite political, cultural, social and economic differences.

www.media.uzh.ch

Literature

Daniel Viviroli, Matti Kummu, Michel Meybeck, Marko Kallio, Yoshihide Wada:Increasing dependence of lowland populations on mountain water resources. Nature Sustainability 2020. doi: 10.1038/s41893-020-0559-9

4aqua aims to give water an evidence-based voice and draws attention to the growing rift that has developed in recent years between urban drainage and agricultural water conservation.

While a great deal has been invested and improved in urban drainage and wastewater treatment, agriculture still has an enormous need for action: the use of nutrients and pesticides is still far too great and very problematic for our water bodies and our drinking water.

4aqua therefore supports the Drinking Water Initiative and demands effective measures from the Parliament.

Political vacuum and weighty need for action

Currently, around one million people in the Swiss midlands receive pesticide-contaminated drinking water that does not meet food requirements. For years, Swiss agriculture has failed to meet all legally binding environmental targets. The National Pesticide Action Plan is a welcome attempt to improve the situation. However, it is accepted that half of the currently polluted stretches of water will remain polluted. Nevertheless, the professional community remains largely silent, since it is not part of the duties of employees in scientific and public institutions to express themselves politically.

Because the drinking water association SVGW and the water protection association VSA also refrain from political slogans, a clearly perceptible voice of the experts is missing for the protection of the waters. 4aqua wants to fill this gap.

Climate change will exacerbate drinking water and water pollution

As an interest group open to all professionals with expertise in the water sector, 4aqua aims to significantly reduce the input of pesticides and other pollutants into water bodies so that Swiss water bodies regain a near-natural, species-rich state and drinking water can be obtained from local groundwater resources without costly treatment.

For 4aqua it is clear: business as usual is not an option. Because climate change will further aggravate the already acute water quality problems. Dry summer months lead to lower water flows in water bodies. With the same substance inputs as before, the water quality will continue to deteriorate as a result.

Asymmetric water protection prevents progress

While billions of Swiss francs have been invested in wastewater treatment over the last 50 years and significant improvements in water protection have been achieved, several billion Swiss francs are paid out annually in subsidies for Swiss agriculture without sufficient reductions in water pollution from agriculture.

While a further treatment stage at wastewater treatment plants eliminates micropollutants from urban wastewater at considerable expense, conventional agriculture releases pesticides directly into the environment and our waters. Moreover, the problem of nutrient surpluses from agriculture remains unsolved until now.

In order to correct this asymmetry in Swiss water protection, the 4aqua expert group is committed to the drinking water initiative. Many farmers already prove today that sustainable forms of production exist and function. From 4aqua's point of view, the future belongs to these systems.

Pesticide registration and use reform

4aqua is also prepared to support other solutions that lead to a significant improvement in water quality, such as the parliamentary initiative "Reducing the risk in the use of pesticides" submitted by the Committee for Economic Affairs and Taxation of the Council of States (WAK-S). However, this initiative requires substantial improvements. To this end, 4aqua calls for an incentive tax on pesticides, pesticide-free inflow areas for drinking water wells, a ban on particularly critical active ingredients, and a reform of the approval procedure for pesticides.

4aqua has high hopes for the competent committee of the Council of States, which will discuss important agricultural business on July 2-3. 4aqua wants to accompany this process in a fact-based way and works on three levels: Advising and informing parliamentarians for their political work, serving the media with expert statements as well as measures in the public.

The 4aqua community of interest was launched less than two months ago and already includes more than 60 experts and scientists. The website https://www.4aqua.ch went online on June 30. 

The Knonauer Amt is an agglomeration region. Despite high settlement pressure, the 14 municipalities have largely succeeded in preserving the rural area. In terms of the proportion of building area and population density, Knonauer Amt has the lowest values in the canton of Zurich after Weinland. The economic aspects are encouraging: workplaces, the number of employees, tax income and tax power have increased significantly since 2010. Value creation benefited. For example, energy projects triggered an annual order volume of 6 million Swiss francs for trade and industry. The heating oil saved by heat pump heating systems saves around 13 million Swiss francs per year and makes the region less dependent on foreign countries.

2020 target already exceeded

Säuliamt wants to cover 80 percent of its electricity and heating energy needs in 2050 with self-produced, renewable energy. In 2020, this should be 23 percent. The figures as of the end of 2019 show a pleasing 26.7 percent - more than double the Swiss value.

The many activities and communicative measures are paying off. Regional energy advice for homeowners and businesses, projects supported by the SFOE and, above all, regular communication. The regional newspaper alone publishes 2-4 articles per week on the subject of energy and the environment. All communities, the economy and the majority of the population are behind the goals of the "EnergieRegion Knonauer Amt". They are convinced: the energy turnaround can be achieved. (Source: Press portal)

As a federally owned company, skyguide is committed to the Swiss Confederation to reduce air traffic emissions and its own responsible energy consumption through operational improvements. To this end, skyguide invests in efficiency measures on the ground and in improved traffic handling in the air, while maintaining or increasing safety levels.

Swiss air navigation service provider skyguide guides aircraft as directly as possible to their destinations in order to reduce fuel consumption and greenhouse gases in air traffic. The company has therefore developed a network of direct flight routes over Switzerland, reducing aircraft waiting times and improving various technical systems. This optimized Approach traffic at Zurich Airport saves 700t of kerosene, 2100t of CO2 emissions and 90% of aircraft waiting time in the air every year. This results not only in a considerable saving in fuel consumption but also in better planning.

Also the Satellite navigation is now more environmentally compatible: it enables flight paths to be flown independently of ground-based facilities, thus allowing more flexible routing. This leads to more efficient flight routes and to lower kerosene consumption, CO2 and noise emissions. To date, skyguide has already implemented more than 200 satellite-based approach procedures. Some conventional land-based navigation systems can be deactivated in this way.

For communication between air traffic controllers and pilots, skyguide operates a Radio system with 700 voice radios and 46 transmitting and receiving stations. The "Smart Radio" project launched in 2012 to renew the entire main radio system will now be completed in 2021. The latest generation radio equipment also significantly improves energy efficiency. Compared to the previous equipment, it 30% consumes less energy, saving up to 200MWh of electricity per year.

Also with the Office infrastructure skyguide is committed to energy-optimized systems, whether in the areas of IT, lighting or paper consumption. In 2019, for example, skyguide significantly improved its average paper consumption of 6kg per person per year compared with the previous year, thanks to its digitization strategy and equipment featuring the latest technology and greater energy efficiency. As a result, skyguide reduced its energy consumption in this area by 89%, equivalent to an annual saving of 30MWh.

"We are proud that we are also successfully doing our homework in the areas of energy and climate year after year, and that we are meeting the strategic targets set by the Swiss Confederation," says Alex Bristol, CEO of skyguide. "Moreover, we are also looking to the future and have committed ourselves to the Swiss Confederation to further increase the efficiency of air traffic - while maintaining a high level of safety."

Further information can be found at:

www.skyguide.ch/wp-content/uploads/2020/06/VBE_Jahresbericht_2019_DE.pdf 

www.skyguide.ch/de/company/environment/  

www.vorbild-energie-klima.ch

The new research center is of great importance because global climate change is advancing - leading scientists worldwide agree on this. This has a particularly strong impact on weather extremes and natural events in the Alpine region, where warming is twice as high as the global average. The result can be floods, debris flows and landslides, as well as long periods of drought in summer. Such events can have social and economic consequences, as demonstrated, for example, by the landslide and subsequent debris flows in Bondo in Bergell.

For this reason, the Swiss Federal Institute for Forest, Snow and Landscape Research WSL, which is already anchored in Davos with its WSL Institute for Snow and Avalanche Research SLF and around 140 employees, has been working with the Graubünden government to find ways to give additional weight to the issues of climate change and natural hazards in the Alpine region. ETH Zurich is also involved in the establishment of an international research center in Davos. The corresponding financing decisions have been made by all parties involved by the beginning of June.

Two new professorships and 40 new jobs

"We need new knowledge and innovative solutions to deal effectively with natural hazards. This is the only way that people can live in mountain regions and manage their economies sustainably," explained Jürg Schweizer, Head of SLF, at the media conference on June 12, 2020, at which the cooperation was presented to the public for the first time.

The planned center is to comprise six research areas and within them two new professorships jointly supported by WSL and ETH Zurich. "Our internationally distinguished climate and environmental research provides a guarantee that the two planned double professorships with WSL will benefit from a strong network. At the same time, we are deepening knowledge about the effects of climate change on the mountain region, which is central to Switzerland," said ETH President Joël Mesot.

While one professorship will study alpine mass movements and permafrost, the second professorship is dedicated to the effects of climate change on mountain regions. Other research topics include early warning, mountain ecology and protection forests, as well as risk communication and resilience, i.e. the ability to deal with natural hazards and reduce vulnerability. In the long term, up to 40 new jobs are to be created at the new center.

CHF 72 million for the first twelve years

The basic funding for the first twelve years from 2021 to 2032 amounts to around six million francs per year. Of this, the canton of Graubünden will contribute two million annually, WSL three million, and ETH Zurich will contribute one million francs annually. These funds secure the basic operation; possible growth plans are to be financed by third-party funds from 2023.

The research center will be formally established this year and will start operations as part of WSL on January 1, 2021. It will be located on the SLF premises in Davos, where work on an extension will start this summer. "WSL is regionally anchored and has long conducted research on mountain topics such as avalanches or rockfall. It is recognized by the users of the research results, which is central for the transfer of knowledge," emphasized WSL Director Konrad Steffen.

First measure of the innovation strategy Graubünden

The center will be a first visible measure under the government's 2021-24 program and underpins the Graubünden innovation strategy adopted last year. "Davos as a research location will be sustainably expanded through the creation of up to forty highly qualified positions," explained the head of the Department of Economic Affairs and Social Affairs, Cantonal Councilor Marcus Caduff. This is intended to strengthen the transfer of knowledge and technology for the regional economy and the cantonal administration - combined with the specific aim of maintaining Graubünden, as well as other mountain regions, as attractive, livable and safe places to live.

However, the research center is not only relevant for Graubünden from an innovation perspective, but it also supports the implementation of the cantonal higher education and research strategy. Government Councilor Jon Domenic Parolini, responsible for education, culture and environmental protection in the Graubünden government, emphasized: "The new research center makes an important contribution to the further development of our canton in terms of society, the national economy and education policy."

More news and information about the ETH research site in Davos

Whether it's waste collection vehicles, refuse containers, truck-mounted sweepers and drive systems - vehicle life cycle costs are the focus everywhere. Anyone still interested in alternative drive systems can learn about the advantages and disadvantages of the new drive systems on July 22. A good preparation is the two-hour online seminar on hydrogen technologies on June 23. It provides information on properties, production and transport.

Vehicle body seminar 

Participants of the online seminar "Qualified person according to DGUV regulation 70 (expert)" learn to assess the operational safety of waste collection vehicles. After participating in this course, they will be able to independently inspect a vehicle body with compactor and lift as a competent person.

Identification systems create order and have a steering effect. They track down all the waste containers that are "black" along the streets. There are often an incredible number of them. On July 15, you will be able to find out more about the charging regulations and technical background information live on the Internet. Underfloor systems are space-saving, barrier-free and contribute to an aesthetic environment.

While underfloor systems are considered expensive to purchase, they also promise many savings. What you can expect will be clarified in the online seminar on July 20.

For drivers of truck-mounted sweepers, kommunalwirtschaft.eu is still offering training courses in the summer on June 30 in Herne and July 14 in Hanover. The three-day instructor advanced training occupation driver qualification takes place from 5. to 7 October in Berlin. The amendment to the law alone will provide plenty to talk about.

Sustainable investments are increasingly in demand from bank customers and investors. Thus, the volume for sustainable investments in Switzerland has increased strongly in recent years. A look at the figures from Swiss Sustainable Finance (SSF) shows that the investment volume increased tenfold from 2014 to 2018 (from CHF 71 billion to CHF 717 billion). Of this, around 90 percent of the volume is attributable to institutional investors. However, as the latest KPMG study "Clarity on Sustainable Finance" shows, uniform standards for measurability and reporting in the sustainability sector are largely lacking. As a result, financial institutions decide for themselves whether and how to integrate sustainability considerations into their business model. Accordingly, the way financial institutions deal with the issue of sustainability varies widely. For investors, this leads to insufficient comparability of investments touted as "sustainable." The increased awareness of the fragility of our economic system in the wake of the Corona crisis is likely to lead to greater attention being paid to non-financial market risks.

Regulation as a driving force

Many market players around the world are increasingly realizing that the capital markets themselves are not in a position to allocate capital in a way that supports the achievement of climate targets. Regulation is necessary in this context to address market inefficiencies. With its "Action Plan on Sustainable Growth" and the "European Green Deal", the European Union is currently implementing the world's most ambitious and comprehensive plan for regulation in various sectors. The EU deliberately wants to achieve a steering effect by eliminating market inefficiencies. The financial industry plays a key role in financing the transition to a sustainable economic system. Due to the feared, irreversible consequences of global warming, the EU is focusing primarily on limiting CO2 emissions and meeting environmental targets. Although it is not yet clear to what extent the Corona crisis will influence the climate agenda, European policymakers seem to be sticking to their thrust and timetable.

In Switzerland, legislators are monitoring developments in the EU, but are not (yet) planning any binding regulation in the financial sector. "Currently, we see a lot of sustainability initiatives in the market among financial institutions, which is basically positive. However, these plans are either oriented towards self-regulation, regulation in individual areas or lean towards EU regulation, which leads to a 'patchwork' of different implementation variants," explains Philipp Rickert, Head of Financial Services at KPMG. "Given the global nature of financial markets and the strong interconnectedness between the Swiss and European financial industries, we expect that EU regulation, at least in its broad outlines, will eventually become the market standard in Switzerland as well." This is not least because the upcoming EU regulation will have an extraterritorial effect in various areas: Financial firms in Switzerland that, for example, provide services to clients in the EU or manage European investment funds may fall within the scope of EU regulation and must also apply it, at least in part.

Uniform standard still missing

For regulatory efforts to be effective, data and reporting have a special role to play. In this context, transparency is essential for the functioning of sustainable finance. Complete and reliable sustainability information is needed so that financing decisions can be made accordingly. The focus here is on information based on the so-called ESG criteria (Environment, Social, Governance). However, the insufficient availability, reliability and completeness of this information is a fundamental problem that cannot be solved in the short term.

Many financial institutions and pension funds are working on disclosing more sustainability-related information. However, there is a lack of binding standards or there are too many different "standards". On the one hand, this leads to the fact that in certain areas reliable data is not yet available, which is necessary for making sustainable investment decisions. On the other hand, the lack of standards is also a reason why companies do not always disclose all relevant information that would be of importance for the beneficiaries or investors. Due to the sensitivity of the younger generations in particular to sustainability aspects, the pressure on institutions to disclose ESG criteria transparently to the outside world is likely to increase further.

In addition, interest in the social and governance factors that have received less attention to date has increased, not least as a result of the Corona crisis. The current crisis has revealed the fragility of the value chains of many industries. It has shown that companies that have placed great emphasis on the health and safety of employees, customers and business partners, and that have clear and efficient decision-making processes, have been able to respond more quickly to the Corona protection measures and adapt their business models.

Pascal Sprenger, a partner at KPMG and a specialist in regulatory issues in the financial sector, expects that the disclosure of sustainability information will be the market standard in the not too distant future and that this information will be audited by independent third parties - as has long been established in other sectors.

Digitization alone is not enough

As the integration of sustainability information into corporate activities is very data-intensive, digitization is likely to give Sustainable Finance a further boost. Not least because younger generations of customers expect transparency without having to wade through reams of data. Says Sprenger: "Financial institutions would do well to model their reporting to their customers more on the user interfaces of modern Internet platforms than on traditional forms of reporting."

However, regulation and technology will not be enough for a company's success in sustainability. In particular, corporate culture is an indispensable basis for any company's credible sustainability program. The KPMG study therefore also shows that financial institutions have a lot of catching up to do, especially in the areas of defining corporate purpose and individual accountability. Particularly in the absence of binding standards and uniform terminology, consistency between a financial institution's corporate culture, strategy and sustainability concept is essential for its credibility.

Greenwashing as a reputational risk

"We observe that most financial institutions are taking a phased approach to implementing their sustainable finance programs. For example, due to high customer demand, 'sustainable investing' is typically an area to which institutions attach great importance early on. However, this approach can lead to inconsistencies within the bank and be perceived by the public as corporate greenwashing. The associated reputational risks should not be underestimated in the age of social media," explains Sprenger. He advocates viewing sustainability not as a regulatory problem, but as an integral part of corporate strategy.

Read more about the current KPMG study "Clarity On Sustainable Finance" at here 

"And yet" (as Charles Aznavour's famous song "Et pourtant" puts it), individual countries could vote in the name of sustainability, the European Union could push ahead with its integration with renewed vigor, tackle the issues of solidarity and coordination, or dare more federalism. An argument for an upswing: "After nearly twenty years of Europe being mostly concerned with itself, the Franco-German plan could breathe new life into the old Europe in the race for competitiveness and attractiveness," writes Laurent Denize, global co-CIO at ODDO BHF Assset Management. The expert knows, however, that from word to deed it could still be a long way off.

High and persistent unemployment

The optimistic expectations of the markets and the actual economic situation, where the current focus is on containing unemployment, particularly in the USA, continue to drift apart. Unfortunately, there is a risk that the labor market will recover much more slowly than production, as the sectors particularly affected by contact restrictions also employ the most people. In the U.S., leisure and hospitality contributes only 4 percent to growth, but employs 11 percent of the working-age population. U.S. retail trade comes in at 5 and 10 percent, respectively. If both sectors are running at half strength (measured against pre-pandemic levels), output falls by 4.5 percent, but employment by 10.5 percent.

Conversely, sectors that are little affected contribute little to employment but much more to growth: Finance, for example, accounts for only 6 percent of jobs but 19 percent of growth. The IT sector employs 2 percent of the workforce, which generates 5 percent of growth, ODDO's Market Flash states.

Central banks could prevent a depression

If the economy picks up again despite contact restrictions - because politicians or the people themselves want it to - growth could recover without the labor market following suit. In this case, the central banks would have no choice but to continue or even expand their extremely expansionary monetary policy. Is this bad news? Not necessarily, because the increasing inflow of "central bank money" has driven valuations on the financial markets to new highs.

Short-term risks of loss

"In the short term, we see some downside risks for the capital markets. These could include new tensions between China and the US, an escalation in Hong Kong, or a second wave of pandemics triggered by the easing measures. At present, the USA is also experiencing considerable unrest and political turbulence. But all these risks need not stand in the way of a normalization of risk asset markets. In our view, there are four reasons for this," concludes Laurent Denize:

• A large rotation into equities that has not yet taken off
• Rapid and flexible intervention by central banks to address corporate financing problems
• Structural changes in the liquidity and interest rate environment
• The gradual easing of containment measures, which is also expected to lead to an economic recovery.

Against this backdrop, the weighting of risk assets will matter less in the coming months than their selection (sector, style, region).

www.oddo-bhf.com/de