Europaudvalget 2019-20
EUU Alm.del Bilag 1037
Offentligt
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Valdis Dombrovskis
Executive Vice-President for An Economy that Works for People and Com-
missioner for Financial Services, Financial Stability and Capital Markets
Union
European Commission
MINISTER FOR INDUSTRY,
BUSINESS AND FINANCIAL
AFFAIRS
Dear Executive Vice-President Valdis Dombrovskis
Thank you for the opportunity to respond to the European Commission’s
targeted public consultation on the establishment of an EU Green Bond
Standard (GBS).
Enabling a green and sustainable transition of the economy is a top priority
for the Danish government. Creating a viable market for sustainable fi-
nance is elementary for financing the substantial investment in green infra-
structure, energy systems, transportation, food production and so forth that
need to be realised in order to reach our common goals of significantly
reducing CO2-levels in 2030.
The Danish Government is initiating investments and considers green
bonds as a critical part of creating a viable and strong market for sustainable
finance. We believe EU GBS is a part of the financial structures that will
enable us to fulfilling our obligations under the Paris agreement as well as
our own ambitions of reducing CO2-levels by 70 percent in 2030. For these
reasons this consultation is particularly welcome.
Overall, introducing a green bond standard will further assist in reducing
detrimental uncertainty as to what constitutes a green investment, ensure
that minimum standards apply, and foster the credibility and integrity of
green bonds towards investors. Denmark is therefore supportive of efforts
to further develop this area of sustainable finance.
While strong supporter of this initiative, we do find that certain themes
should be the object of careful consideration in order to assure the creation
of a both balanced and useful EU Green Bond Standard. We have a strong
focus on making the EU Green Bond Standard work in practice across dif-
ferent financial systems in Europe.
First, Denmark is
–
along with all other member countries
–
a potential
issuer of green bonds. We are committed to investigate the possibilities for
Denmark to add a green element to the Danish government bond pro-
gramme. In small countries with low sovereign debt, like Denmark, it is of
utmost importance to maintain a certain level of liquidity and therefore a
MINISTRY OF INDUSTRY,
BUSINESS AND FINANCIAL
AFFAIRS
Slotsholmsgade 10-12
1216 Copenhagen K
Denmark
Tlf.
+45 33 92 33 50
Fax.
+45 33 12 37 78
CVR-nr. 10092485
EAN nr. 5798000026001
[email protected]
www.em.dk
 EUU, Alm.del - 2019-20 - Bilag 1037: Notat samt dansk høringssvar vedr. Kommissionens offentlige høring om Green Bond Standard
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certain volume in the different bond series in both the green and the non-
green bond market. Therefore, it is important that the EU GBS in its tech-
nical implementation embraces the needs of smaller member states with
low sovereign debt, and that EU GBS technically can be structured in other
ways than standard bonds issuance as long as all green requirement of the
EU GBS are complied with, i.e. a certificate-model where both the liquidity
in the bonds and the green commitment is upheld.
Secondly, we believe it is important for the development of the green bond
market that both institutional and retail investors can have confidence in
the proceeds from EU Green Bonds being used for green expenditures. In
relation to this, we have identified potential technical and legal issues in
relation to the Danish mortgage credit system regarding the use-of-pro-
ceeds, which are potentially also relevant for financial systems in other Eu-
ropean countries.
Thirdly, we believe it is important that investors have strong confidence
that green bonds will maintain their status as green, even though the defi-
nition of green expenses can change over time. If investors cannot have
certainty that green bonds will maintain their status as green for the entire
maturity, it can have a negative effect on the market.
Fourthly, we appreciate that there can be a potential for COVID or social
bonds. In
order to avoid “social washing”,
we believe it is important for a
potential social bond to have a solid foundation for defining social expenses
in a similar way that the taxonomy defines expenditure for the EU GBS.
In conclusion, Denmark continue to support a strong framework for an EU
Green Bond Standard as a key element in creating a viable market for sus-
tainable finance and look forward to the future work.
Attached please find our specific replies to the consultation document. As
always, I am at your disposal should you or your team have any questions
or comments.
Yours sincerely,
Simon Kollerup