Today, there are a growing number of financial products and services that claim to be sustainable. However, until now, there have been no global standards that cover sustainable finance in its totality.
As a result, companies are struggling with a lack of reliable practices and guidance on integrating sustainability and environmental, social, and corporate governance (ESG) considerations in their financial decision-making. This lack of consistency and assurance within the market has created an environment of distrust and confusion from consumers and businesses alike when it comes to sustainability claims.
International standards are essential for mobilizing finance globally to address environmental and social imperatives and ensure future prosperity.
BS ISO 32210 Sustainable finance. Guidance on the application of sustainability principles for organizations in the financial sector is a new international standard that helps firms in the finance industry to integrate sustainability considerations including environmental, social and governance practices (ESG) in the financing of their economic activities.
BSI’s Nature Investment Standards Programme was set up with the aim of encouraging a wider uptake of sustainable finance practices, behaviours, thinking, products and services, while helping organizations from the financial sector align themselves with the global UN Sustainable Development Goals (SDGs).
Part of this programme included developing globally relevant, consensus-based standards on sustainable finance through the establishment and secretariat of a new international committee ISO/TC 322, Sustainable Finance. This committee of experts is charged with creating standards that help to facilitate a sustainable investment market.
One of their achievements is BS ISO 32210. Developed in collaboration with a vast stakeholder community and built upon existing efforts and initiatives, it aims to support financial organizations globally.
This standard sets out principles and practices to support financial organizations to enable positive environmental and social outcomes, risk mitigation and deliver sustainable value. It provides a framework for organizations that wish to be sustainable and better aligned with global initiatives.
The framework recognizes that transformation is needed to equip the industry to address issues including poverty, inequality, climate change, environmental degradation, prosperity, peace, and justice.
BS ISO 32210 outlines the key sustainable finance principles which form the core elements of this standard. The principles are aimed at supporting organizations in aligning their business strategy and operations with sustainability goals and objectives that are material to the organization and its stakeholders.
To implement its guidance effectively, organizations are recommended to begin by addressing the key elements of the principles starting with ‘governance and culture’ and ‘strategy alignment and objectives’. They can then work through the others.
Using the concept of continual improvement and enhancing ambition, organizations can use this BS ISO 32210 to improve sustainability performance and outcomes.
Learn how our standards are supporting the UK’s progression to net zero by visiting our Net Zero Topic Page.
The adoption of BS ISO 32210 helps businesses to provide greater consistency and reliability in how sustainability (and ESG) considerations are integrated into their investment decision-making. Its guidance also helps to improve transparency and investor confidence, providing a means for organizations to demonstrate practices are sustainable and responsible.
BS ISO 32210 has been designed for organizations to use regardless of their level of expertise or capacity. It can therefore be adopted by any business active in the financial sector, including:
Direct lenders and investors
Asset managers
Financial service providers
Beyond financial institutions and intermediaries, BS ISO 32210 can be used by other parties in the financial sector too. These include providers or recipients of sustainable finance, governmental organizations, public and private sector, business entities, industry associations, financial market regulators, and supervisory and control bodies.
In 2021,PD ISO/TR 32220 Sustainable finance. Basic concepts and key initiatives was launched. Together with BS ISO 32210, it consolidates concepts that exist and agree common terminology and international best practice and guidelines for the industry.
Both these standards provide a platform from which organizations involved in sustainable investment can develop their products further and enable more players to enter the market.
These standards also complement ISO14097 Framework including principles and requirements for assessing and reporting investments and financing activities related to climate change, which helps financiers assess and report on their actions and see the real value of their contribution to climate goals.
Over 100,000 more internationally recognized standards are available for simple and flexible access with a BSI Knowledge subscription. When facing the pressure of increasing your positive outcomes for the benefit of future generations, our subscription service puts the control in your hands. With traceability to monitor and demonstrate your business's compliance to standards and self-serve functionality that enables you to manage your standards, users can access standard content quickly and simply. Request to learn more.
Make improvements and increase trust in the sustainable resilience of your financial activities, by adding BS ISO 32210 to your collection today.