As to date there is no common definition of what Paris Alignment means and implies in practice, the Climate Action in Financial Institutions hosted an expert workshop to help fill this gap. The event aimed to take stock of progress made and identify areas to move forward on Alignment with the Paris Agreement. Part of a series of workshops, which started at COP24 in Katowice, it brought together more than 80 experts on the topic of alignment from the financial institutions and research community.
The workshop identified the points of convergence and remaining divergence on what Paris Alignment means in Practice. The event included the launch of the joint research project Aligning with the Paris Agreement[2] conducted by I4CE and CPI with support from ECF and IDFC – as well as updates on progress made to date by MDBs’, IDFC Institutions and IIGCC[3]. Building on these presentations, participants of the workshop highlighted that it is important for financial institutions to go beyond doing no harm to also make direct contributions to achieving the long-term climate objectives. A number of continued challenges around Paris Alignment in practice were nevertheless highlighted, including:
- Defining and measuring the consistency or inconsistency of activities;
- Managing the lack of visibility and uncertainty around the national trajectories; or
- The difficulties to integrate or ‘mainstream’ within institutions a common understanding of what alignment requires and the implications for business models and operations.
All participants of the workshop agreed on the need to further collaborate between all types of financial institutions and to collectively work on addressing some of the common questions raised. The Climate Action in Financial Institutions Initiative will continue to provide a space for collaboration on this topic towards COP25 and 2020.