Beyond profit: Launch of report on EU’s green finance challenges

The report, entitled ‘Beyond profit: How to reshape the European Green Deal for people’s well-being’, examines the EU’s key funding mechanisms such as the Recovery and Resilience Facility (RRF) and InvestEU. It reveals significant shortcomings in how the EU’s investment strategy is being implemented, particularly its tendency to prioritise technological innovation and competitiveness over the basic needs of people and environmental sustainability. Additionally, crucial long-term solutions have been overlooked, leading to deficiencies in the quality and timing of funding. 

Frank Vanaerschot, Director of Counter Balance, says: ‘As it stands, the financing of the European Green Deal is built on shaky foundations. It pursues a short-term, market-based economic model that is incompatible with climate goals, economic growth and turning a profit. A stronger environmental agenda in Europe requires political will to build popular legitimacy through robust public investment in all Member States. Such investment must prioritise a just transformation by providing sufficient funding for critical climate actions and delivering green public services such as affordable housing, energy, transport and healthcare.’  

At present, InvestEU and the European Investment Bank (EIB) primarily target private investors, resulting in profitable companies receiving a significant portion of public funding. While the RRF represents progress in financing green initiatives with substantial resources allocated to Member States, its actual impact falls short, as only 18 per cent of milestones and targets have been achieved despite reaching its midpoint. Additionally, green policies face implementation challenges, particularly in central and eastern Europe. For example, in Latvia, no milestones and targets have been fulfilled relating to the green transition, and only 2 per cent in Bulgaria.   

Daniel Thomson, EU Policy Officer for Biodiversity at CEE Bankwatch Network, says: ‘The EU’s recovery fund was heralded as a key driver of Europe’s green transition when first announced. Yet halfway through implementation, we’re now seeing significant challenges emerging. In several countries, green measures have been delayed to such an extent that they risk not being implemented, and in some cases green projects have been removed entirely. The need to spend funds quickly should not compromise the enormous potential to deliver on the EU’s green objectives.’ 

The report advocates for a transformative public finance strategy that empowers citizens, civil society and local governments with access to information and resources for meaningful participation in shaping climate policy, recognising their central role in both legitimising and implementing climate action at the local level. 

For more information, please contact:

• Frank Vanaerschot, Director, Counter Balance, frank.vanaerschot@counter-balance.org, +32 (0) 487 67 16 27
• Daniel Thomson, EU Policy Officer for Biodiversity, CEE Bankwatch Network, daniel.thomson@bankwatch.org, +32 (0)2 893 08 61

Notes to editors:

• The Citizens’ Observatory for Green Deal Financing is a coalition of civil society organisations from across Europe advocating at EU and national levels for more transparency and a just distribution of EU funds.
• Full report can be accessed here.