3. Climate-related policies in officially supported Finnish export finance

Finnvera as a public institution must follow government policies, including broader Finnish climate commitments. Most significantly, with the “world’s most ambitious climate target in law” (Lo, 2022), Finland aims to be the first developed country to reach net zero in 2035, and be net-negative by 2040, absorbing and storing more CO₂ than it emits (State Treasury, 2024). Finland’s 2022 landmark Climate Change Act (see Text Box 2) is based on four key policy plans,

The Medium-term Climate Change Policy Plan; the National Climate Change Adaptation Plan; the Long-term Climate Change Policy Plan and the Climate Change Plan for the Land Use Sector.

all of which have been co-prepared by the Finnish Climate Change Panel of experts and the Sámi Climate Change Council

Of Finland’s indigenous Sámi people, who are particularly vulnerable to climate change.

(Ministry of the Environment, 2022c).

While Finland’s Medium-term Climate Change Policy Plan has been in place since 2022 (Ministry of the Environment, 2022b), the first long-term climate plan will be adopted by 2025 at the latest, according to the Climate Act (Ministry of the Environment, n.d.).

‘Greening’ Finnish export finance further and faster could have significant positive climate impacts: For example, the first-ever analysis of climate benefits from Swedish exports found significant emissions reduction higher potential (up to 70%) compared to goods that were not made in Sweden (Material Economics, 2024). Considering Finland’s overwhelmingly clean electricity mix (Statista, 2024), for example, a similarly high potential would not be unsurprising.

See further https://web-assets.bcg.com/00/b9/f29b47d3483ab495047411f25680/bcg-finland-moonshots-for-green-growth-feb-2023.pdf.

Text Box 2 provides an overview in reverse chronological order of the most recent climate-related policies of the Finnish government for Finnvera as well as notable internal commitments and practices.

Text Box 2: Selected climate-related commitments and practices by/for Finnvera

Since 2022, ‘greening’ Finland’s export sector is mentioned coherently throughout key government documents related to Finland’s landmark Climate Change Act (Ministry of the Environment, 2022a),
Whether Finland will meets its climate target(s) will, however, largely depend on its forests, which cover three-quarters of Finland‘s land area (Lo, 2022). This explains the rather large share of export finance support provided to Finland’s pulp and paper industry (see section 2).
e.g. in the National Climate and Energy Strategy or the Programme on Clean Energy of Prime Minister Petteri Orpo
Explicitly stating that ”[as] Finnish businesses export solutions for sustainable energy systems to the rest of the world, Finland can increase its climate handprint” (Lo, 2022)
(Ministry of the Environment, 2022c; Finnish Government, 2023).
So far, however, export finance is not referred to in Finland’s Annual Climate Report monitors trends regarding the achievement of Finland’s climate targets and detailed plans (Ministry of the Environment, 2023).
In 2011, Finland passed the ‘Act on State guarantees and export guarantees granted to industry for investments promoting environmental protection (609/1973)’ offering incentives for environmental and climate-beneficial investments. Finnvera manages these state guarantees targeting the energy, transport, and industry sector (Finnvera, n.d.f).
As early as 2001, the Finnish Parliament mandated Finnvera to proactively invest in environmentally and climate beneficial businesses, thus taking responsibility for special purpose guarantees.
E.g. State Ship Guarantees (573/1972), State Guarantees and Export Guarantees for Investments Promoting Environmental Protection (609/1973) or the Act on State Guarantees to Secure the Supply of Basic Raw Materials (651/1985).

Sources: Finnvera, 2023d; E3F, 2024

The following section provides for an in-depth assessment of all ‘Paris alignment’ dimensions and substantiates recommendations drawn from scientific literature and best practices in the global export finance system. This assessment is designed to guide Finnvera as well as responsible authorities to safely achieve net zero by 2035 or before.