“It is clearly the most demanding green finance label of the French and European labels.», Says Laurent Trulès, manager-analyst, coordinator of responsible investment at Dorval AM. Created ten years ago, on the occasion of the COP 21 of Paris for the Climate under the acronym TEEC (Energy and ecological transition for the climate), renamed Greenfin For “green finance» in English, the French eco-label is looking for new impetus.
Because it remains little known, both among savers and among managers themselves. According to the census published by the Ministry of Ecological Transition on December 19, there are only 106 funds representing assets of 36 billion euros, a drop in the bucket in the gigantic universe of investment funds and the 900 billion placed in unit of account on life insurance. Especially since the Greenfin label concerns both funds intended for the general public and institutional investors. There are only a dozen equity funds intended for individuals, most of which invest in debt, securities issued by unlisted companies and infrastructure projects.
However, the label guarantees the seriousness of the financial and extra-financial analyzes of the managers of labeled funds on environmental criteria, but also on social and governance criteria, in line with those of the ISR label (socially responsible investment). For its part, the ISR label, more well-known and widespread, concerns funds intended for individuals whatever their investment theme.
Importance of eco-activities
Concretely, Greenfin-labelled funds must justify a significant proportion of eco-activities in key sectors for decarbonization such as energy, buildings, waste management and pollution control, industry, transport, agriculture and forestry, adaptation to climate change, information and communication technologies. They must follow the lists of eco-activities defined by the Label Committee, and/or the European taxonomy which in turn defines activities linked to the climate transition.
Managers have an obligation to analyze the contribution to the greening of the planet and the reduction of greenhouse gases of each line of their fund. So “Technology companies eligible for the Greenfin label are those whose activities directly support ecological and energy transitions by improving energy efficiency, facilitating the integration of renewable energies or contributing to sustainable infrastructure», explains Alvaro Ruiz-Navajas, manager of the Tocqueville Environnement ISR fund (La Banque Postale).
Limited latitude for companies
The companies are grouped into three pockets according to their contributions to activities, the pocket of companies carrying out more than 50% of their activity must represent at least 25% of the fund and the so-called diversification pocket cannot weigh more than 20%. Between the two, there may be an intermediate pocket comprising companies generating a significant part, but less than 50%, of their turnover in eco-activities. This system forces managers to focus on the climate theme, while leaving them room to diversify.
“You have to be very selective about the financial and extra-financial qualities of the companies in the portfolio, whether they belong to eco-activities or not. For companies not included in eco-activities, we ensure through indicators (CO2 emissions or climate transition plan for example) that they match our ambition to support the ecological and energy transition.» explains Laurent Trulès at Uzès Gestion. Managers must submit themselves every year to the screening of certifiers (Afnor, EY, Novethic) mandated by the Ministry of Ecological Transition, Biodiversity, Forests, Sea and Fisheries and provide their impact measurements. A real commitment.
Fewer fossils, but more atoms
The contours of the label have evolved in recent years to match the definition of energies eligible for transition according to European standards. January 2024, nuclear power made its debut. On the other hand, at the start of 2025, the exclusion threshold linked to coal was reinforced. From now on, coal must no longer exceed 1% of the turnover of the company in question, instead of 5% previously.
