The plan: collective action for the EU election
- The Reset Finance Agenda aims at bringing CSOs, academics and campaigners together under a single vision and a set of policy reforms for the financial system.
- Civil society organisations, academics and policy experts are invited to endorse both the vision text and the reforms list. The “sign on” will open on 4 October 2023.
- We will then call on candidate MEPs and the next Commissioners on behalf of signatories to pledge their support for this Agenda.
- Pledgers and EU officials will be solicited along their 2024-2029 mandates as legislative opportunities arise for the Agenda’s policy reforms.
Read the “vision” text below and contribute to the policy reforms list by submitting your policy proposals here.
- Expand to read the "vision" text of the Agenda
“Our financial system is working against us. The post-crisis reform agenda to make the financial system safer and more resilient has stalled as new challenges for the financial sector are not being adequately tackled. We need to reset finance and regulate for a future with a financial system that will serve people and the planet.
To get to a financial system with a purpose that works for people and the planet, we need:
1. To reset regulations supposed to protect us from failing institutions and future financial crises
2. To reset the role of finance, ending extractive practices and enabling a sustainable future
3. To reset financial practices that exclude or harm consumers, to ensure they participate fully and equally in society
4. To reset rules in the digital world, protecting data and privacy, financial stability and consumer interests
5. To reset rules on public finance and unlock investment in our future
6. To reset the role of lobbying in lawmaking to rebalance the representation of the public interest in supervision and regulation.
How did we get there?
In 2008, the curtain was pulled back on our financial system. Instead of finding strong, stable guardians of finance managing our money, we bore witness to private and public institutions, to whom we looked for answers, crumbling, powerless, or retreating from view. Granted our implicit trust, these institutions had operated with little or no regulatory oversight.
Financial institutions were spared at the last moment by the system’s supervisors, with governments buying up their ‘toxic assets’, rather than pursuing reforms to a failed status quo. Normal working people paid for the financial and economic crisis they caused. Governments used taxpayers’ money to save failing banks, postponing necessary investments in schools, hospitals and support systems when we needed them most urgently. Society was forced to pay the debts of greed-driven financial institutions – the debts we didn’t need – and was forced to abandon investment in future generations – the debts we needed.
Overwhelming public demand for change echoed into the offices of panicked policymakers. Those overseeing the financial system scrambled to restore confidence in their leadership with commitments to fundamentally reform the status-quo, promising us stable, resilient and purposeful financial institutions.
This new ambitious agenda of articulating the rules necessary to regulate international financial institutions quickly stalled after years of technical discussions became infiltrated by vested interests. Financial lobbyists called for and received the delays and exceptions in the rules they wanted and used them to manoeuvre out of the way of most attempts at regulating their industry.
The financial system is now more regulated than before 2008 but on the terms of the banks, insurers and investment firms running it.
What is to be done?
The financialisation of our economy has accelerated: Financial markets are intruding into basic areas of life such as medical and care services, housing, and water supply. Rather than investing in these sectors to support them and share in profits, they are increasing their debt and extracting any profit that can be found to the detriment of service quality and social conditions. This means that rather than having a financial system that channels finance to where society needs it, the system focuses on profit extraction first with little regard for societal consequences. Reset finance means closing down these practices and ensuring that finance serves society, not vice versa.
Our leaders have made new commitments to address the current climate and environmental emergency and ensure the financial system plays its part. They have enshrined climate targets in law to transition our economy away from fossil fuels and greenhouse gas emission-intensive activities , to become more sustainable. They call on the financial system to channel investment to finance the transition to a sustainable economy. The EU sustainable finance framework was created to support this objective, yet many loopholes and inconsistencies remain. Whilst financial institutions complain about undue regulatory complexity, they keep financing fossil fuels and other activities that contribute to the climate crisis, environmental degradation, as well as rising inequality.
With today’s oversized, complex, increasingly digitalised, and interconnected financial system, weak regulation is a dangerous path that puts the stability of the financial system and the protection of consumers at risk. We must pause, step back and push the reset button before the next major crisis happens.
Our leaders must give the financial system a clear purpose, safety and resilience to support people and the planet, not profit from them at any cost. Governments must lead with a credible transition plan and related investments. They must reform public debt rules to liberate sufficient and future-oriented public spending. They need to regulate with a long-term forward-looking perspective, not compete to deregulate and put our future at risk.”
Next: Join our Reset Finance Kick-Off call
Date & time: 3 October, 10h-11.30h CEST, online.
Objective: Introduce the Reset Finance Agenda, its framing and campaign planning. Collect feedback.
Fill this form to register for the Kick-Off call