Climate change is referred to by leading economists as the greatest market failure in human history, with potentially disruptive implications on the social well-being, economic development, and financial stability of current and future generations: conservative estimates see unabated climate change leading to global costs equivalent to losing in-between 5 to 20% of global gross domestic product (GDP) each year, now and forever.

As a result, public and private decision-makers around the world are faced with the dual imperative of:

  • Significantly – and rapidly – reducing greenhouse gas (GHG) emissions worldwide, by decarbonizing the global economy, in order to prevent the mean global temperature increase from reaching dangerous levels
  • Adapting global consumption and productions patterns, lifestyles, and the underlying supply-chains, to the physical – meteorological, hydrological – impacts of climate change that are now unavoidable

The finance sector, lying at the heart of today’s global markets, faces the same challenges, but it also is presented with the vast financial opportunities associated with overhauling economies towards climate-compatibility:

  • On the one hand, new risks – recently categorized into transition-, physical, and liability-risks –  need to be understood, identified, assessed, managed, and eventually disclosed on, by institutions across financial industries.
  • On the other hand will the transition to low-carbon and climate-resilient economies require additional investment at an order of magnitude of at least USD 60 trillion, from now until 2050; and that investment will require financing which, in part, will have to be provided by financial institutions: USD 35 trillion to decarbonize, through renewable energy and energy efficiency, the world’s energy system; another USD 15 trillion to adapt manmade infrastructure to changing meteorological conditions; and another 2 USD trillion to reorganize global land-use is ways that meet growing demands for agricultural commodities while stopping tropical deforestation.

For financial institutions to not only weather changing risk landscapes but for them to also become determined enablers and catalysts of the climate economic transition, a number of conditions need to be met: FIs need to understand the commercial risks and opportunities implied, and know how to act on them. Legislators and regulators, including financial regulators, on the other hand, need to understand the roles, potentials, and policy-needs, of financial institutions; they also need to know how they can help steer the finance sector to become an enabler, rather than inhibitor, of the climate economic transition.

As the interface between the financial industry and world Governments, UNEP FI is uniquely positioned to help meet those conditions. Join us.

Please contact Remco (Kai) Fischer  for more information.

21 April 2021

Net-Zero Asset Owner Alliance more than triples membership to 37 since 2019 launch

21 April 2021 – The United Nations-convened Net-Zero Asset Owner Alliance today announces a tripling in membership from its launch at the UN Secretary General’s Climate Action Summit in September 2019, with 37 members now committing to set and report on interim targets towards net-zero portfolio emisisons by 2050. Alliance members Wespath and the David…

20 April 2021

UNEP FI/MinterEllison Launches Litigation Risks in Adaptation Finance Paper

The fifth edition of the UNEP Adaptation Gap Report (2020) found that 72% of countries have adopted at least one national adaptation instrument in their policy planning. Most developing countries are also preparing National Adaptation Plans to strengthen their focus on climate change adaptation. However, the capital needed to implement these plans has yet to…

11 March 2021

German insurance association GDV partners with Net-Zero Asset Owner Alliance

The UN-convened Net-Zero Asset Owner Alliance welcomes Germany’s insurance industry association GDV as a supporting partner – the first insurance industry association to become a supporter of the Alliance. GDV will be in a strong position to support better science and knowledge in measuring climate change impacts on business activities. Chair of the Net-Zero Asset…

5 March 2021

Dai-ichi Life Insurance is first Asian member of Net-Zero Asset Owner Alliance

Japan’s Dai-ichi Life Insurance Company joins the United Nations-convened Net-Zero Asset Owner Alliance, to become the first member based Asia. With assets under management (AUM) of $379 billion, Dai-ichi becomes the 35th member of the fast-growing Alliance, which has total AUM of $5.6 trillion. By joining the Alliance, the company commits to reducing greenhouse gas…

16 February 2021

Net-Zero Asset Owner Alliance calls on asset managers to support blended finance

The UN-convened Net-Zero Asset Owner Alliance has issued a call to asset managers to collaborate in driving the development of blended finance vehicles, with the aim of drastically ramping up investment in climate solutions. One working area of the Alliance is focused on financing transition of the real economy, which focuses on identifying priority investment…

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21 April 2021 | Online

COP26 & The Glasgow Financial Alliance for Net Zero

Mark Carney, the UN Special Envoy for Climate Action and Finance - in partnership with the UK COP26 Presidency and the UN Race to Zero campaign - are launching a coordinating alliance that brings together existing and new net zero finance initiatives into one sector-wide strategic forum: The Glasgow Financial Alliance for Net Zero (GFANZ).

20 April 2021 | BrightTalk

Climate Change Litigation and Liability Risks in Adaptation Activities & Finance

To explore adaptation finance from a litigation perspective, UNEP FI has collaborated with MinterEllison to examine how litigation may increase or reduce the barriers to adaptation finance identified in the earlier reports. The output of this collaboration, a high-level briefing paper "The Forgotten Climate-related Financial Risk: Liability Impacts on Adaptation and Adaptation Finance", will be launched at this event.

13 April 2021 | BrightTalk

Webinar: Climate Thought Leadership Series Papers 5 & 6

Join UNEP FI and EIT Climate-KIC for the launch of the 5th and 6th papers of this Thought Leadership Series: “Making Green Bonds Serve the Climate Goals" (Massamba Thioye, UNFCCC) and "Financial Stability in a Planetary Emergency: the role of regulators in a burning world" (James Vaccaro, Director of Re:Pattern, & David Barmes, Economist at Positive Money).

8-31 March 2021

Workshops: Climate Risks and TCFD for banks in Egypt and Tunisia

For banks in Egypt and Tunisia, join our series of workshops that will provide you with a better understanding of physical and transition risks as well as climate risk methodologies and tools to strengthen your bank’s resilience and help implement the recommendations of the Task Force on Climate-related Financial Disclosures.

16 February 2021 | Webinar

Outlook for North America Climate Policy & Impact on Sustainable Finance Agenda

As the United States rejoins Paris, what are the key areas of policy to focus on for the financial sector, how will that increase ambition on emission reduction targets. What are the key regulatory changes and key issues for sustainable finance, how to navigate the environment, assess the challenges and opportunities across sectors? Join us for a discussion on the policy landscape and other key focus areas in this climate ambition year.

18 February 2021 | Webinar

Adaptation Webinar Series: Climate Data for Physical Risk Assessments

The use of authoritative datasets and data sources is a challenge for many financial institutions. A collaboration between the Climate Data Factory and the EU's Copernicus Climate Change Service is aiming to provide a climate hazards data set of reference for physical risk assessment that aligns with the recommendations of the TCFD, and that will also slign with the needs of users from the finance sector.

9 February 2021 | BrightTalk

Webinar: Climate Thought Leadership Series Papers 3 & 4

Systemic transformation will be necessary over the next decade if we are to meet the goals of the Paris Agreement. What might this transformation mean for the finance sector and how can financial actors best respond to these challenges? Join Richard Roberts & John Elkington (Volans), and Jakob Thomä & Anne Schönauer (2DII) for this discussion hosted by EIT Climate-KIC and UNEP FI.

25 January 2021 | Webinar

UNEP FI and members at the Climate Adaptation Summit 2021

Join UNEP FI and members for an in-depth discussion on climate-related physical risk and a major announcement from ten financial institutions. UNEP FI is hosting a side event at the Climate Adaptation Summit which will also see leading financial institutions announce their commitment to climate-related physical risk assessment and disclosure, while making a ‘call to action’ to the finance sector and governments around the globe to address the principal obstacles to greater disclosure.

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Liability risk and adaptation finance

UNEP FI has partnered with MinterEllison to examine the impact of litigation in adaptation finance and address some of the challenges in scaling up adaptation capital identified in the GCA Adaptation Finance Paper published in 2019. This collaboration led to the publication of “The Forgotten Climate-related Financial Risk: Liability Impacts on Adaptation and Adaptation Finance“ in April 2021.  This high-level briefing…

Aligning Finance for the Net-Zero Economy: Thought Leadership Papers 5 & 6

UNEP FI has partnered with EIT Climate-KIC to bring the Thought Leadership Series, which presents papers from some of the world’s leading thinkers to help guide the financial sector towards a sustainable future. Our aim is to inspire financial actors worldwide to move from risk to alignment, challenge current assumptions around climate alignment and develop ideas…

The Climate Risk Landscape: Mapping Climate-related Financial Risk Assessment Methodologies

The Climate Risk Landscape: Mapping Climate-related Financial Risk Assessment Methodologies provides a summary of the key developments across third party climate risk assessment providers since May 2019, including new and updated scenarios, methodological tools, key guidelines, as well as an overview of the changing regulatory landscape and potential developments into 2021. This report covers both…

Pathways to Paris: A practical guide to climate transition scenarios for financial professionals

Pathways to Paris’ is a practical guide for financial practitioners looking to understand and apply climate scenarios. Co-authored with the Center for International Climate Research (CICERO), a world-renowned research institution on climate and climate finance, the report examines the driving assumptions and sectoral coverage of the models used to produce climate scenarios, as well as…

Aligning Finance for the Net-Zero Economy: Thought Leadership Papers 3 & 4

UNEP FI is continuing its partnership with EIT Climate-KIC to bring some of the world’s leading thinkers to contribute to a series of thought leadership papers. Our aim is to inspire financial actors worldwide to move from risk to alignment, challenge current assumptions around climate alignment and develop ideas and concepts on how alignment can…

Promoting Sustainable Finance and Climate Finance in the Arab Region

This report analyses the climate change related risks countries in the Arab region are facing such as water scarcity, rising sea levels, drought, land degradation and desertification. It sheds light on the existing strategies and policies on climate adaptation and mitigation in the region, and emphasizes the importance of sustainable finance resources in transitioning to…

Collective Commitment to Climate Action: Year One in Review

The Collective Commitment to Climate Action (CCCA) is the most ambitious global banking sector initiative supporting the transition to a net zero economy by 2050. It brings together a leadership group of 38 banks from across all six continents who have committed to align their portfolios with the global climate goal to limit warming to…

Beyond the Horizon: New Tools and Frameworks for Transition Risk Assessments from UNEP FI’s TCFD Banking Programme

Beyond the Horizon: New Tools and Frameworks for Transition Risk Assessments from UNEP FI’s TCFD Banking Programme Thirty-nine global financial institutions from six continents participated in UNEP FI’s second TCFD banking programme. Through this yearlong engagement, the participating banks collaborated with climate risk experts and each other to improve financial assessments of transition risk. In…

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