2. Ethical Investment in a neo- liberal economy Friends of the Earth (England, Wales and Northern Ireland)

3. Can ethical investment deliver sustainable development? No. Not within the EU neo liberal economic framework as outlined in the EU Financial Market Action Plan Why? Exists primarily as a ‘niche market’ for green consumers EU financial framework doesn’t recognise SEE impacts on business and wider environment Insufficient penalties for damaging environment Requires proactive policies to promote and develop ethical industries like recycling and renewables

4. Is ethical investment a threat to sustainable development? Yes, it could be. Why? promotes myth of ethical consumers as significant influence on markets encourages use of voluntary action such as Corporate Social Responsibility (CSR) Doesn’t fundamentally challenge inequities in the neo liberal economy but sits within it

5. What can the EU do to encourage ethical based investment Integrate social, ethical & environmental (SEE) issues into the way business operates How 1.Develop EU financial action plan based on –acknowledgement of environmental limits –fair share of resources –social justice and equality –right of citizens to determine what sort of development is allowed in their community

6. What can the EU do to encourage ethical based investment Integrate social, ethical & environmental (SEE) issues into the way business operates More 2.Reform company law to make directors accountable for SEE impacts (ie. Company Directives) 3.Reform stock market listing rules to include disclosure of SEE risks to encourage ‘long term’ focus within City (ie. Prospectus and Transparency Directives) 4.SEE reporting standards (ie. Reporting regulations)

7. What can the EU do Create a liability regime for companies who damage the environment How Develop an environmental liability directive based on the polluter pays principle, strict liability, no exemptions, compulsory insurance and third party access to justice (ie. Reform proposed Environmental Liability Directive)

8. What can the EU do Reform tax system to encourage green and social responsible businesses How Implement taxes on environmental or social bads - tax on farm chemicals (eg. pesticides) to reduce use, - climate change levy to Kyoto commitments, - tax on aviation fuel to reduce greenhouse emissions.

9. What can the EU do Reform tax system to encourage green and social responsible businesses How Give tax breaks or subsidies for green and socially responsible business - reform CAP to uncouple subsidies from production volumes in favour of sustainable farming practices, - remove VAT on social housing and eco homes, - VAT reduction on energy saving products, - tax break for use of recycled or reused material

10. What can the EU do Develop EU wide policies to encourage business to embrace sustainability and social justice How Use Government itself to influence business by implementing ethical purchasing policy for all Government departments, agencies etc Directly encourage business by proactively developing policies that promote growth of sustainable industries such as renewables and recycling (including setting of targets for market share) Support Fair Trade rules

11. Challenge to future of EU Are we citizens or are we consumers ? Past EU began as trading block Evolved into loose political federation Possible Futures EU is a single financial market based on neo liberalism EU as a democratically accountable political entity based on environmental justice and respect for human rights

12. Want to know more www.foe.co.uk (see publications and briefings under Policy and Research Unit, Global Trade and Corporates) www.foeeurope.org (see briefing on ‘Towards a Green EU constitution’)