France’s Minister of the Economy, Finance and Recovery, Bruno Le Maire, has announced critical updates to the French SRI label.
The revisions are set to intensify the climate-centric focus of the label, consequently barring most oil and gas corporations from participating in SRI-labelled funds.
The SRI label, a brainchild of the French Ministry of the Economy and Finance introduced in 2016, encourages public investment in savings plans that are compliant with Environmental, Social, and Governance (ESG) criteria. To date, it has been embraced by nearly 1,200 funds, commanding over €770bn in assets under management. This label is a staple in life insurance portfolios and pension savings schemes.
These sweeping reforms are the result of efforts initiated in 2021 by Le Maire, who formed a committee dedicated to amplifying the SRI label’s ambition and stringency. Since its inception, the SRI label’s criteria have remained largely unchanged, prompting the need for this overhaul.
The newly introduced standards will enforce the exclusion of entities engaged in the extraction of coal or unconventional hydrocarbons, as well as those initiating new ventures in oil and gas exploration, production, or refining from SRI-labelled funds. Furthermore, included companies must now possess a transition plan that aligns with the objectives of the Paris Agreement.
In a statement, Le Maire emphasised the role of the revamped SRI label in enabling French citizens to make meaningful investments. “We must offer a simple and effective label to allow the French to give meaning to their savings. This is what we are doing with this new SRI label, in which the fight against global warming is becoming essential. We will thus allow savers to take into account the ecological transition and businesses to finance their decarbonization more easily,” Le Maire articulated.