Launch of the Hungarian Sustainable Investment Finance Association: A New Era for Sustainable Finance in Hungary
In a significant move towards promoting sustainable finance in Hungary, a group of former central bankers, led by Gábor Gyura, has established the Hungarian Sustainable Investment Finance Association (HuSIF). This initiative aims to foster sustainable investments and enhance collaboration among financial institutions in Hungary, marking a pivotal moment in the country’s financial landscape.
The Founding Team and Their Vision
The HuSIF is convened by Aquincum Sustainable Finance Initiative (ASFI), a non-profit organization founded by Gyura and a dedicated team of former colleagues from the Hungarian National Bank (MNB). This team includes notable figures such as David Pápp, the former head of sustainable finance policy at MNB, Márton Kruppa, a former senior analyst in sustainable finance, and Veronika Lakatos, who has experience in financial stability and bank resolution.
Gyura has expressed a commitment to establishing HuSIF as a key player in the sustainable finance arena, with plans to seek observer status with the European Sustainable Investment Forum (Eurosif) in the near future. His motivation stems from observing the emergence of similar initiatives across Central and Eastern Europe (CEE), prompting the need for a dedicated platform in Hungary.
Context: The Growing Landscape of Sustainable Investment Forums
The establishment of HuSIF is part of a broader trend in the CEE region, where sustainable investment forums are gaining traction. Following the launches of PolSIF in Poland, Czech SIF in the Czech Republic, and RoSIF in Romania, HuSIF becomes the fourth such initiative in the region. While Gyura acknowledges common goals with these other forums, he emphasizes that the evolution of sustainable finance in Hungary has its unique characteristics and challenges.
Targeting Key Market Players
The primary audience for HuSIF includes asset managers, pension funds, insurance companies, and investment banks. Gyura has reported that major market players in Hungary have already expressed interest in participating in the forum’s inaugural meeting. However, he emphasizes that the goal is not merely to increase membership numbers but to attract members who share a common vision for sustainable finance.
The State of Sustainable Finance in Hungary
Gyura notes that Hungary’s banking sector is slightly ahead of the investment sector regarding sustainability initiatives. This progress can be traced back to the MNB’s strong regulatory push, which began in 2019 with the publication of its green strategy. At that time, sustainability was not a priority for most financial institutions, with few dedicated sustainable finance teams in place.
The MNB’s green strategy has since catalyzed significant changes, leading to the establishment of green strategies, finance teams, and loan products across all Hungarian banks. The central bank has also implemented various supportive measures, such as green capital requirement discounts and green mortgage refinancing programs, which have collectively raised substantial funds for green initiatives.
Despite these advancements, Gyura points out that the share of ESG funds in Hungary remains relatively low, with only 6% of the mutual fund industry classified as sustainable. This presents a considerable opportunity for growth, prompting the decision to create a market-led initiative like HuSIF to drive collaboration and progress in sustainable finance.
HuSIF’s Strategic Activities
The HuSIF aims to undertake several key activities in its first year to promote sustainable investments in Hungary. These include:
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Capacity Building: The forum will focus on fostering collaboration among investors to address common challenges and effectively implement EU regulations, such as the Sustainable Finance Disclosure Regulation (SFDR) and MiFID II. Gyura envisions this as a crucial step towards increasing sustainable investments in Hungary and Europe.
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Retail Investor Education: Recognizing the lack of awareness among Hungarian retail investors regarding sustainable investment options, HuSIF will prioritize educational initiatives to enhance understanding and interest in sustainable funds. Gyura believes that increasing retail investor engagement is essential for expanding the sustainable finance market.
- International Collaboration: HuSIF will work to enhance the international presence of Hungarian market players by connecting them with other sustainable investment forums in the region and across Europe. This collaboration aims to share best practices and drive collective progress in sustainable finance.
Conclusion: A Promising Future for Sustainable Finance in Hungary
The launch of the Hungarian Sustainable Investment Finance Association represents a significant step forward in the country’s journey towards sustainable finance. Under the leadership of Gábor Gyura and his team, HuSIF is poised to play a vital role in fostering collaboration among financial institutions, enhancing investor education, and promoting sustainable investment practices in Hungary.
As the global focus on sustainability intensifies, initiatives like HuSIF will be crucial in ensuring that Hungary remains competitive and aligned with international sustainable finance standards. With a clear vision and strategic objectives, HuSIF is set to make a lasting impact on the Hungarian financial landscape, paving the way for a more sustainable future.