TY  - JOUR
A1  - Brühl, Volker
T1  - The Green Asset Ratio (GAR): a new key performance indicator for credit institutions
T2  - Eurasian Economic Review
N2  - The financial sector plays an important role in financing the green transformation. Various regulatory initiatives in the EU aim to improve transparency in relation to the sustainability of financial products and the sustainability of economic activities of non-financial and financial undertakings. For credit institutions, the Green Asset Ratio (GAR) has been established by the European regulatory authorities as a key performance indicator (KPI) for measuring the proportion of Taxonomy-aligned on-balance-sheet exposure in relation to the total assets. The breakdown of the total GAR by type of counterparty, environmental objective and type of asset provides in-depth information about the sustainability profile of a credit institution. This information, which has not been available to date, may also initiate discussions between management and shareholders or other stakeholders regarding the future sustainability strategy of credit institutions. This paper provides an overview of the regulatory background and the method of calculating the GAR along different dimensions. Finally, the potential benefits and limitations of the GAR are discussed.
KW  - Sustainable finance
KW  - Green finance
KW  - Green Asset Ratio
KW  - Taxonomy Regulation
KW  - Sustainable Finance  Disclosure Regulation
Y1  - 2023
UR  - http://publikationen.ub.uni-frankfurt.de/frontdoor/index/index/docId/86318
UR  - https://nbn-resolving.org/urn:nbn:de:hebis:30:3-863180
SN  - 2147-429X
VL  - 13
IS  - 1
SP  - 57
EP  - 83
PB  - Springer
CY  - Berlin ; Heidelberg
ER  -