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European financial centres continue to lead the way in green finance, while Canadian centres are losing ground, according to new rankings from U.K.-based consulting firm Z/Yen.

The latest edition of the firm’s Global Green Finance Index (GGFI) found that Western Europe leads the world centres in both the depth and quality of “green finance” — based on quantitative assessments provided by various organizations, including the World Bank, the OECD and the United Nations, along with 4,219 survey responses rating the financial centres.

Centres in Western Europe accounted for nine of the top 10 places in the combined rankings, led by Zurich, Amsterdam and London.

“This reflects the continuing work being undertaken by European financial institutions, central banks, regulators, and the European Union to embed sustainability in their regulatory work, including their economic support in response to the Covid-19 pandemic,” the report said.

However, there was a changing of the guard within the region, with Zurich and Amsterdam surpassing London, both in the quality index and overall.

Outside of Europe, San Francisco ranked as the leading city, moving into 10th place. For North America, San Francisco ranked first for both depth and quality.

“San Francisco replaced Montreal as the top ranking centre for depth and continued to lead the region for quality, now featuring in the top 10 globally in both rankings,” the report said.

The report also noted that U.S. centres generally improved or maintained their positions within the depth and quality rankings, whereas the Canadian cities saw their depth rankings decline and their quality rankings improve.

Vancouver was the exception. It saw its rankings on both measures increase, moving it into second spot within North America and 11th place globally.

Montreal, Toronto and Calgary fell in the rankings for depth, and Toronto also fell in the quality rankings. In the combined rankings, Montreal ranked 15th globally, while Toronto was 27th and Calgary ranked 42nd.

The report said that the leading driver of green finance continues to be regulatory policy, “reinforcing the fact that green finance is a policy-driven sector…requiring government and regulatory action to thrive.”

“Covid-19 has accelerated change in much economic activity. As societies seek innovative recovery, they have ‘zoomed in on’ the potential of ‘going green’ much faster. Consequently, green and sustainable finance have come to the fore,” the report said.