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Final report on financing the green transition: Major investments are required but also create new opportunities for Finland

Aerial view of residential houses in Finland

The final report of the national working group on financing the green transition in Finland, published on 9 December 2022, states that to mitigate climate change, halt biodiversity loss and transition to a circular economy, major investments will be needed from businesses, households and the public sector. The green transition will require system-level change in all of society and a comprehensive reform of economic structures, but it will also increase demand for Finnish expertise.

In January 2022, the Ministry of Finance, the Ministry of the Environment, and the Ministry of Economic Affairs and Employment appointed a national working group to get a comprehensive view on financing the green transition and financing measures to accelerate the transition in an ecologically, economically and socially sustainable manner. According to the working group, Russia’s war of aggression has escalated the change in the geopolitical situation and increased the urgency of the green transition and the need to break away from the fossil-fuel economy.

The report presents the key objectives defined by the working group to develop green transition financing and offers solutions and an estimate of the scale of the related investment needs. The report also discusses the role of various parties in financing the green transition and the different ways in which sustainability is taken into account in the financial markets. The working group submitted its final report to Minister of Finance Annika Saarikko, Minister of the Environment and Climate Change Maria Ohisalo and Minister of Economic Affairs Mika Lintilä on 9 December.

The working group was made up of public and private sector experts. One of the working group’s members was MuniFin’s Head of Funding and Sustainability Antti Kontio.

“Being a part of this important national working group has been inspiring. As a result of our work, the key parties in the green transition now have a shared view of the development needs and recommendations for the transition”, says Kontio.

According to the report, the green transition will open up new opportunities for Finland by increasing global demand for Finnish expertise, sustainable solutions and innovations.

“Our customers – municipalities and affordable social housing organisations – play a major role in the green transition. Our job at MuniFin is to support the important work our customers are doing to the best of our ability: by financing the green transition and by sharing our customers’ innovative sustainable solutions to help achieve the national goal of carbon neutrality by 2035”, Kontio explains.

The report is in Finnish and a summary in English can be found here.