French finance minister issues rallying cry to reform capitalism
Le Maire calls for sustainable economic model based on social responsibility
French finance minister Bruno Le Maire has called for an “urgent transition” to a form of capitalism that is based on social responsibility in an attempt to curb the rise of populism.
Mr Le Maire, speaking at an investment conference in Paris, said that the visible effects of climate change and the surge in populist sentiment had laid bare the need for an economic model that seeks to tackle environmental and social concerns.
“We need a new capitalism for the 21st century, which would be more sustainable and which would allow us to reduce inequalities among nations and within nations,” said Mr Le Maire.
Mr Le Maire’s calls add weight to the chorus of support for reforms to the current capitalist system. Last month, the Business Roundtable, which has close to 200 corporate members, took the unprecedented step of dropping its creed of shareholder primacy, declaring that companies should consider the environment and workers’ wellbeing alongside their pursuit of profits.
The EU last year began working on sustainable finance legislation in a move to channel more money into green investment and place environmental, social and governance concerns at the heart of finance.
But Mr Le Maire, who said the EU had “a special duty to build [a] fairer capitalism, consistent with its founding values”, urged EU policymakers to “move faster”. He called for action on an EU green bond standard and said France would push for a social and environmental reporting framework for companies at European level.
“People, especially young people, will not wait for our decisions,” he said. “They are asking for a new economic model now.”
He added. “If we want to avoid the rise of populism all over Europe and the world, we need to give concrete answers and concrete responses to what young people are calling for.”
Mr Le Maire told delegates at the annual conference of the Principles for Responsible Investment, the UN-backed sustainable finance body, that France would “push for a green new deal to be implemented as soon as possible” and would seek to convince EU rulemakers to follow in the footsteps of French domestic legislation, including climate risk disclosure rules for institutional investors introduced in 2015.