Members of the Transformational Finance for Climate Group have developed this position paper to support the publication of the Baku to Belém Roadmap and inform other multilateral processes focused on Paris-aligned finance such as the Sharm el-Sheikh Dialogue. The paper outlines how public and private actors—from development banks and climate funds to institutional investors and commercial banks—can work together to reorient and mobilize financial flows for transformational impact, scaling high-quality, just, inclusive, and long-term finance using a systems-level approach.

While global climate finance flows reached USD 1.9 trillion in 2023, only 17% was recorded in emerging markets and developing economies (excluding China)—where needs are greatest—with about USD 200 billion provided from international sources.¹ To meet the goals of the Paris Agreement and the political ambition of mobilizing USD 1.3 trillion annually by 2035 under the Baku to Belém Roadmap, finance must support systemic approaches that reshape markets, policies, and institutions.

This paper outlines foundations and a shared theory of change for a more strategic and impactful use of finance, addressing systemic barriers and leveraging catalytic opportunities.

About the Transformational Finance Group

The Transformational Finance for Climate Group (Group)—deriving from the Making Finance Work for Climate Initiative launched at COP29—brings together thousands of leading public and private financial actors from developed and developing countries, representing more than 40% of global financial assets. Members include the International Development Finance Club (IDFC), the Finance in Common system (FiCS), UNEP Finance Initiative (UNEP FI), the Principles for Responsible Investment (PRI), and the Mainstreaming Climate in Financial Institutions Initiative.

The Group also works closely with key partners such as the Green Climate Fund (GCF), as well as the Network for Greening the Financial System (NGFS), NZAOA, and the Net-Zero Export Credit Agencies Alliance (NZECA), making it a unique platform for coordinated action and consolidated input into global finance processes.

1  Climate Policy Institute (2025) Global Landscape of Climate Finance 2025