The Bank of Russia and the Ministry of Finance will work out the issue of introducing investment limits for non-state pension funds (NPF) into green and social (ESG) bonds. This is reported by the newspaper Kommersant June 4, with reference to the minutes of a meeting with Finance Minister Anton Siluanov on the development of the securities market, held at the end of April.
It is noted that the initiative is in line with the previous initiatives of the authorities in the field of ESG investment and the establishment of limits for pension insurance in relation to other instruments.
The publication indicates that the order must be completed by September.
Experts note that the allocation of a limit is “a method of stimulating investments in bonds and shares of companies that meet ESG criteria.” Asset selection is possible based on green ratings.
The specialists also said that if the “green” bonds will give a lower yield, they need to be classified within the framework of fiduciary responsibility. But the problem of fiduciary responsibility has been discussed abroad for several years, and there is still no clear answer to the question of whether it is possible to acquire “green” instruments at the expense of profitability.
Currently, 16 issues of green and social bonds worth almost 100 billion rubles are traded on the Moscow Exchange.
In March, Russian President Vladimir Putin following a meeting on the banking sector instructed the government, together with the Central Bank, to develop, by September 1, measures to reduce the negative impact on the Russian economy of falling demand for assets with high climatic risks.
At the same time, the Central Bank began to recruit employees for the sustainable development division, and the first deputy chairman of the regulator Sergei Shvetsov said about the need to “push the financial market to take into account the medium-term and long-term risks of ESG,” the newspaper notes.
In April 2021, the Region group of companies announced the consolidation of all non-state pension funds included in the group by the end of the year. Consolidation and bringing to a single standard will take place on the basis of the Evolution Fund with the participation of NPF Future, UMMC-Perspektiva and NPF Safmar. Prior to the merger, NPF Safmar will be renamed into NPF Decent Future.