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Leaseurope report highlights the role of leasing in transition finance

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Leaseurope’s new report – The role of leasing in enabling the transition to a climate-neutral and sustainable European economy – highlights case studies of transition finance, which may not be eligible under the current EU taxonomy but still demonstrate a material contribution to sustainability.

The report also looks at the sets out high-level proposals for measuring and reporting this key type of finance.

In the short- to medium-term, transition finance is expected to be far more significant than green finance in Europe, and the European leasing industry is likely to lead in providing transition finance to SMEs across Europe.

Leaseurope believes that all transition finance, including both finance and operating leases and all finance for SMEs as well as larger companies, should be recognised in the reporting of sustainable finance required from banks and other financial companies.

This should include:

  • The EU definition of green loans that is being developed following the recent Opinion of the European Banking Authority
  • Future sector-specific European Sustainability Reporting Standards and the International Financial Reporting Sustainability Standards

According to Leaseurope, this is essential to ensuring banks and other providers are able to continue to support European SMEs, as well as larger businesses, on their journeys to sustainability.

The new Leaseurope report sets out a high-level proposal for how this could be achieved for green transition investments using leasing.

The report is available to download now at https://www.leaseurope.org/leaseurope-released-new-paper-role-leasing-transition-finance