The economy's green transition is a great challenge, and the financial industry is invited to contribute to the success of the transition, the head of the Croatian Financial Services Supervisory Agency (HANFA) management board said at the "Join the ESG Revolution", which opened in Zagreb on Thursday.

The two-day conference on Environmental, Social, and Corporate Governance (ESG) was organised by the Croatian Insurance Bureau (HUO) in cooperation with Eurizon Asset Management Croatia.

ESG criteria are non-financial indicators referring to the strategies and policies of companies when it comes to the environment, society and governance.

The HANFA director, Ante Zigman, said that non-financial statements are becoming more and more important given that ESG reporting is having an effect on companies’ creditworthiness and their attractiveness for investment.

The biggest emphasis is put on the green segment, including climate change, CO2 emissions, waste management and so on, he added.

Zigman said that the financial industry had an important role in making the green transition successful.

The first day of the conference also addressed the issue of greenwashing, when companies and organisations give a false impression of their environmental impact or benefits. Greenwashing misleads market actors and does not give due advantage to those companies that are making the effort to green their products and activities. It ultimately leads to a less green economy.

The Privredna Banka Zagreb management chairman, Dinko Lucic, said that the banking sector is also expected to contribute to the ESG transformation of the society.