Self-regulation on sustainable finance

Minimum requirements for integrating sustainability criteria into investment and mortgage advice

The sustainable finance guidelines lay down binding rules for integrating sustainability criteria into investment advice and portfolio management, as well as mortgage advice. By making sustainability themes – in other words, environmental, social and governance (ESG) factors – and energy efficiency an integral part of retail client consultations, the industry is making a concrete and important contribution not only towards the achievement of the Paris Agreement’s climate goals, but also to the further strengthening of Switzerland’s position as a premier sustainable finance hub.

Both sets of guidelines in their initial versions are binding for SBA members with effect from 1 January 2023, although various transition periods are specified to allow banks to adapt their internal processes. The guidelines will be regularly reviewed in light of market developments and updated as necessary. This has already happened for the first time with the Guidelines for the financial service providers on the integration of ESG-preferences and ESG-risks and the prevention of greenwashing in investment advice and portfolio management in 2024. Non-members can adopt the guidelines on a voluntary basis. 

Guidelines for the financial service providers on the integration of ESG-preferences and ESG-risks and the prevention of greenwashing in investment advice and portfolio management

According to a 2022 study by Swiss Sustainable Finance (SSF), assets totalling CHF 1,982.7 billion were being managed sustainably in Switzerland at the end of 2021. Swiss financial service providers have been offering suitable products and services for some time now.

The legal basis for the Guidelines for the financial service providers on the integration of ESG-preferences and ESG-risks and the prevention of greenwashing in investment advice and portfolio management is the Financial Services Act (FinSA). Clients are asked about their ESG preferences and then offered appropriate products and services. The guidelines also set out obligations for the provision of information, documentation and accountability when establishing the client’s ESG preferences. Members are also obliged to include ESG topics in the training and professional development of their client advisors. By offering clients professional and transparent advice on sustainable investments, financial service providers play an important role in preventing greenwashing. The revised guidelines take account of the Federal Council’s position on the prevention of greenwashing in the financial sector, published on 16 December 2022. This means in particular that they include a clearer description of the conditions for labelling investment solutions as sustainable.

Guidelines for mortgage providers on the promotion of energy efficiency

The purpose of the “Guidelines for mortgage providers on the promotion of energy efficiency” is to encourage mortgage providers to consider long-term value retention, and consequently the energy efficiency of the building to be financed, when offering clients advice on financing a property. The intention is to make clients aware of the importance of energy efficiency upgrades. The initial focus is on advice to private individuals seeking finance for single-family and holiday homes. This advice should also include information about expected upgrade requirements for the property in future, as well as details of subsidies available for building upgrades and independent specialist agencies able to offer specific guidance. Members also undertake to provide regular training for their client advisors regarding the long-term value retention and energy efficiency of properties.