The Climate Action in Financial Institutions Initiative launched the Climate Mainstreaming Practices Database on the sidelines of COP23.

On Thursday the 9th of November, CAF, EIB and I4CE (Secretariat of the Initiative), co-organized the official UNFCCC side event “Mainstreaming the Paris Agreement in the Financial Sector”.

Keynote speech from Felix Bergel, Director of Institutional Funding, CAF

“Financial institutions (and not only the Multilateral banks but also Regional, Bilateral and National Development Banks so as commercial financial institutions from developed and developing countries), can play a key role in addressing the challenges of a global low carbon and resilient development, internally and through relationships with their clients. The Five Voluntary Principles for Mainstreaming Climate Action within Financial Institutions provide a statement of leadership and a framework for collaboration and exchange of lessons as financial institutions develop and mainstream approaches to address climate change.

Since 2015, the financial institutions have in many instance built on existing practice already, as illustrated by the examples and case studies presented in the 2015 Emerging Practices Paper. Sin that time, many new approaches have been developed and piloted to move from commitments to action. Most of us have undertaken efforts to incorporate climate change considerations within our operations since 2015. The approaches tools and methodologies developed by some Supporting Institutions are really innovative solutions: and this is all the purpose of the Mainstreaming Initiative to share those efforts between the different Supporting Institutions, but also with all the public and private organizations involved in low-carbon and resilient development.

Today, I am proud to inform you of the launch of the Online and publicly-accessible Climate Mainstreaming Practices Database. Elaborated with the help of the Mainstreaming Initiative’s Secretariat (I4CE – Institute for Climate Economics), this database will be a tool for Supporting Institutions – as well as for the broader financial and business community.”

Today it contains over 50 case studies prepared and submitted by member financial institutions on how they are integrating climate change into their operations.

The Initiative calls on its members – as well as the broader financial community – to continue to contribute to sharing knowledge. We thus invite everyone to submit case studies for consideration to the Secretariat. Furthermore, we invite other financial institutions – whether public or private, across all countries – to join the initiative and move to voluntarily integrate climate change into everything that they do by adopting the 5 Principles. It is only through cooperation and working together to develop new tools, methods and ways of doing business can the financial community come together had fulfill our part of supporting the Paris Agreement.

Panel discussion

Damien Navizet, Head of Climate Division, Agence Française de Développement
Damien Navizet presented how the AFD has been progressively implementing the 5 Voluntary Principles for Climate Mainstreaming. He emphasized the implementation of Principle 1 “Commit to climate strategies” as the AFD is now finalizing its third climate strategy, which will integrate the objective of “100% compatibility with the Paris Agreement” of AFD financing.

Terry McCallion, Director, Energy Efficiency and Climate Change, European Bank for Reconstruction and Development
Terry McCallion highlighted how the EBRD has a dedicated energy efficiency team since 1994 and shared lessons learned from its Green Economy Financing Facilities that have demonstrated how “green economy loans” can make good business sense. He noted that a challenge to mainstreaming climate change to ensure a focus on opportunities and have a strategy to unlock the value from low-carbon projects.

Stewart James, Managing Director, Group Government Affairs, HSBC
Stewart James emphasized the necessity of leadership at the highest level to support mainstreaming, putting targets in the scorecards of business managers and offering internal training and capacity building. HSBC announced the committed of $100bn for climate by 2025 and requests clients to implement the recommendations of the Task Force on Climate Disclosures, on the sidelines of COP23.

Read Statement: Namita Vikas, Group President & Global Head, Climate Strategy & Responsible Banking, YES BANK

“Climate change is real and is affecting businesses across the globe. Strategically responding to the opportunities presented is extremely critical for ensuring healthy business bottom lines and creating a shared value for the environment and communities. The principles for mainstreaming climate action serve as voluntary, non-binding and aspirational guidelines for financial institutions like YES BANK to move further in adapting to climate change and promoting climate-smart development. 

The principles would certainly move the needle in the right direction by steering a global action to level the playing field.”

Pa Ousman Jarju, Director of Country Programming Division, Green Climate Fund
Pa Ousman Jarju underlined the GCF expectations on each of the 5 Principles and especially the need to develop a culture of accountability among all financial institutions. The GCF will assess its accredited entities every 5 years and evaluate how they integrate climate change. For this, they are committed to support its counterparts to mainstream climate change.

Gaia Larson, Senior Associate Climate Finance, World Resources Institute
WRI has been working on this issue for several years and they identified two key challenges: defining climate finance and measuring the alignment of a portfolio, beyond investments in the energy sector. They are currently analyzing investments in infrastructures in energy transmission and distribution.

Conclusion: Monica Scatasta, Head of Environment, Climate and Social Policy, European Investment Bank, representing EIB Vice President Jonathan Taylor

In conclusion, Monica Scatasta underlined several challenges to mainstream climate change: the need for a strong leadership, but also to ensure that everyone is committed towards this objective, the need to urgently decarbonize portfolios, and the need to urgently address climate risks.

“We have an enormous challenge ahead of us, and we cannot do it alone. It is important to share a common language“. The initiative is a step forward in this direction.

Monica Scatasta called for financial institutions part of the initiative – and others – to “Walk the Talk” of the 5 Principles – as as they are trying to do across the EIB.