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From commitment to action: a look back at the 2018 Climate Finance Week in Paris

30 November 2018 - Blog post

This week, the finance community gathered in Paris for a series of events focusing on climate change and sustainable development. With more than 1500 participants and 100 speakers from the financial community, the week was marked by major events of this week were the UNEP FI’s Global Roundtable and the 4th Climate Finance Day.

 

 

On one hand, the week began with a ‘reality check’ through the publication on Monday of a report by Oxfam France demonstrating that between 2016-17 French commercial banks reduced investments in renewable energy as much as they increased investments in fossil fuels. On the other hand, the financial community reiterated their engagement with several commitments and calls to action made during these three days including:

 

  • AXA Group, the French global insurer, announced that its newly acquired division, AXA XL will no longer underwrite the construction and operations of coal plants, coal mines, oil sands extraction and pipelines, as well as arctic drilling.
  • Eric Lombard, CEO of the French Caisse des Dépôts announced the lowering of its threshold for carbon exclusion from 20% to 10% of the total of a company’s annual turnover;
  • Bruno Le Maire, Minister for the Economy and Finance of the French Republic called on banks, insurers and asset managers “to make commitments to stop financing mines and coal-fired power plants. These commitments must be controlled and transparent. If these commitments are not met, they will be made binding.”
  • François Villeroy de Galhau, Gouvernor of the Banque de France highlighted that the publication of the Network for Greening the Financial System’s (NGFS) first progress report in October. This report represents an important step as for the first time this coalition of 21 supervisors and central banks unanimously acknowledged that as climate-related risks are a source of financial risk – and thus it is within the mandates of central banks and supervisors to ensure the financial system is resilient to these risks.

 

 

I4CE contributed to discussions throughout the week

Benchmarking emerging practice: In the run-up to the week, I4CE released week a report produced with WWF France presenting a first stock-take of the implementation of the Article 173-VI of the French Energy Transition Law, and its impact on the evolution of reporting and investment management practices.

 

Taking stock: Pierre Ducret, I4CE’s President, and Maria Scolan (Caisse des Dépôts) published the special report on finance of the 2018 Global Observatory on non-State Climate Action. The report presents the progress made towards the greening of the global financial system. It gave a concrete basis for discussions for Climate Finance Day, taking stock of private and public actors’ commitments and achievements on green and climate finance issues.

 

Moving from commitments to action: As Secretariat of the Climate Action in Financial Institutions Initiative, Benoit Leguet, I4CE’s Managing Director moderated a panel session of Climate Finance Day that presented the concrete experience of 5 of the 42 financial institutions participating in this Initiative in making climate change an operational priority across business lines.

 

Read the summary of the session

 

Advancing research: I4CE organized a side-event with the Institut Louis Bacheliet, the Banque de France and Finance for Tomorrow bringing together academics, finance practitioners and regulators to discuss together the recent research advances in the field of modelling climate-related financial risks, provide a better understanding of the role of central banks in addressing these risks, and formulate the relevant research agenda for the years to come.

To learn more
  • 02/17/2023 Foreword of the week
    Climate transition plans for banks: European legislators on a razor’s edge

    The proposal for mandatory climate transition plans for banks is slowly making its way through the regulatory debate. Proposed by the European Commission and confirmed by the EU Council, this proposal has now also been taken up by the European Parliament. This obligation could be a game-changer for financial risk management and the alignment of financial flows with the transition to a low-carbon economy. It could lead banks to limit their activities in climate-damaging activities, adjust their business models, review their strategies as well as their governance and risk management procedures.

  • 02/16/2023 Op-ed
    OP-ED – Climate transition plans for banks: European legislators on a razor’s edge

    The legislators in Europe are discussing the introduction of mandatory climate transition plans for banks. After the European Commission and the Council, the European parliament has adopted its position. Now trilogue negotiations between the three will begin. While all three seem to agree on the idea itself, differences remain in how these plans are defined. Anuschka Hilke, Director of the Finance program from the Institute for Climate Economics (I4CE), explains in this blog which parameters will be decisive for framing the ambition of this legislative proposal.

  • 01/18/2023
    The limitations of voluntary climate commitments from private financial actors

    Private finance will not fund the transition without a stronger commitment from public authorities.
    For several years, and particularly since COP 26, considerable time and attention has been dedicated to the subject of voluntary commitments from private financial actors. These commitments, made within the framework of international initiatives, should in principle enable private finance to be mobilized for the transition to a carbon neutral economy.

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