UNEP FI welcomed more than 3000 participants at its 17th Global Roundtable (GRT), held virtually under the theme “Transforming Finance, Accelerating Change”. Watch all recordings here.
Eric Usher, Head of UNEP FI, opened the 17th Global Roundtable, which coincided with the organisation’s 30th anniversary. He highlighted the spearheading role that UNEP FI, its members, and supporting institutions have made over the past 30 years. Whilst noting the tremendous progress made by experts and leaders in the sustainable finance space, he stressed that the time for change is now, and further action is required. Eric encouraged finance institutions to consider if they have the right systems, targets, governance, policies, and capacities to accelerate the transition, and what role they can play in creating a more sustainable future.
Pictured: Eric Usher, Head, UNEP FI
The GRT saw a welcome address from Diony Lebot, Deputy CEO of Société Générale, who stated that the finance industry must deliver on its pledges for a net-zero carbon objective by 2050. She said that the “world economy is at a crossroads” and finance can lead the way by investing in activities that accelerate the transition. To do this, financial institutions must act collectively whilst ensuring clarity, consistency, and transparency in their pathways. She stressed that the objective should not be the greening of finance, but rather, the transformation of the real economy for the well-being of society and the planet.
Pictured: Diony Lebot, Deputy CEO of Société Générale
Former US Vice-President Al Gore, who is also Chairman of Generation Investment Management, highlighted the importance of public policy engagement, stewardship, and asset allocation for financial actors to steer real economy change in his keynote speech. Welcoming the work being done by UNEP FI, the PRI and Generation Foundation as part of the joint project “A Legal Framework for Impact”, he reiterated the need to work with investors and policymakers to enable and empower the investment community to deliver sustainability outcomes. Finally, he emphasized the urgency to align all facets of the financial system to move from one that passively manages risks to one that proactively considers impact of business activities, and is aligned with global goals such as the Paris Climate Agreement and the UN Sustainable Development Goals.
Pictured: Al Gore, Generation Investment Management Chairman and Former US Vice-President
UNEP Executive Director Inger Andersen in her keynote address spoke about how, for 30 years, UNEP FI has worked to catalyse private finance to address the triple planetary crisis of climate change, biodiversity loss and pollution. Under UNEP FI’s various initiatives, frameworks, and partnerships, the financial sector has laid plans for tremendous responses to these crises. She explained that promises and plans alone will not get the job done; now more than ever, it is time to turbocharge these efforts and deliver on these promises. Doing so is in the best interests of people, the planet, and the finance industry.
Pictured: Inger Andersen, Executive Director, UNEP
The high-level dialogue between Mark Carney, UN Special Envoy on Climate Action and Finance and UNEP FI’s Head, Eric Usher, focused on the Glasgow Financial Alliance for Net-Zero (GFANZ)’s members commitment to address the climate crisis and finance the transition to a net-zero economy. It set the expectations for the financial institutions that form part of this global movement and laid out the steps needed from the finance sector to achieve our common climate goals. While addressing the importance of accountability, consistency, and transparency throughout institutions’ journey to net zero, Carney highlighted the upcoming Net Zero Data Public Utility, a free platform to help regulators, financial institutions, and data providers to overcome climate data gaps which he hopes will create a positive feedback loop between key stakeholders. Finally, he addressed the role that policymakers need to play, together with the industry, to move from voluntary to mainstream adoption of net-zero finance and achieve the ultimate goal: financing action in the real economy.
Pictured: Mark Carney, UN Special Envoy on Climate Action and Finance and UNEP FI’s Head Eric Usher
Christiana Figueres, Founder, Global Optimism, Oliver Bäte, CEO, Allianz and Emmanuel Faber, Chair of the International Sustainability Standards Board (ISSB) engaged in a high-level dialogue on aligning climate and sustainability goals. They discussed the big commitments that financial institutions made to deliver net-zero economies and how they can quickly operationalise them. Whilst tools and standards developed by organisations such as the ISSB will help financial institutions make responsible decisions, the message coming loud and clear from this discussion was that governments must support private sector action with well-constructed policy and regulations.
Pictured: Christiana Figueres, Founder, Global Optimism, Oliver Bäte, CEO, Allianz and Emmanuel Faber, Chair of the International Sustainability Standards Board (ISSB)
In a fireside chat, Catherine McKenna, Chair, UN High-Level Expert Group on the Net-Zero Emissions Commitments of Non-State Entities, mapped out what to expect from the upcoming High-Level Expert Group (HLEG) report, due to be submitted to UN Secretary-General Antônio Guterres ahead of COP27 in November, describing some of the major challenges facing companies and investors in setting credible net-zero emission targets. If companies want to decarbonise, they must support enabling policies. Lobbying against climate change policies by companies can be a “massive problem” for governments, the former Canadian Infrastructure Minister said. On the Task Force on Climate-Related Financial Disclosures (TCFD), she pointed to its fast uptake, explaining that the TCFD has now transitioned into something that is becoming mandatory in many jurisdictions. The HLEG is looking at standards and criteria for necessary commitments from financial institutions, corporates, cities and regions because credible net-zero commitments really drive climate action, ensuring that those that are really doing the work are recognised.
Pictured: Catherine McKenna, Chair, UN High-Level Expert Group on the Net-Zero Emissions Commitments of Non-State Entities and Eric Usher, Head, UNEP FI
The high-level dialogue between Elizabeth Mrema, Executive Secretary, Convention on Biological Diversity (CBD), and Koushik Chatterjee, CFO, Tata Steel and member of the Taskforce on Nature-related Financial Disclosures (TNFD) as well as TCFD, focused on the intersections between climate and nature. As nature action rises up in the sustainability agenda, especially in recent years, policymakers and businesses must begin to acknowledge the interdependence between climate and nature. Both panellists brought out the important message that climate change and nature loss must be addressed together in order to achieve the best possible result and agreed that awareness of this fact is currently leading actions to a positive direction. They then discussed the similarities of work and approaches between TCFD and TNFD and ended the session by reiterating that businesses should consider both climate and nature as they craft and implement their sustainability strategies.
Pictured: Elizabeth Mrema, Executive Secretary, Convention on Biological Diversity, Koushik Chatterjee, CFO, Tata Steel and member of TNFD and TCFD and Jessica Smith, Nature Lead, UNEP FI
In her closing remarks, Liesel van Ast, Deputy Head of UNEP FI said that financial institutions can and should collaborate to define pathways, methodologies and standards whilst investing in the right resources to address global sustainability challenges. They should also transform within to achieve this, which is where the Principles for Responsible Banking Academy, launched at the GRT, will be crucial. She stressed the key role of the insurance industry in accelerating the transition towards a net-zero, nature-positive and equitable global economy and society. She highlighted the progress made by the Net-Zero Asset Owner and Net-Zero Insurance Alliances on their intermediary and long-term targets; targets which, she emphasised, need to be high-quality, science-based and can translate net-zero commitments into action that translate into public policy for long-term decisions. Liesel emphasized how finance needs to drive policy change, and the need for convergence of policy frameworks across jurisdictions, whilst reiterating Inger Andersen’s point on the need to develop a financial system that is fit for purpose for the transition.
Pictured: Liesel van Ast, Deputy Head, UNEP FI
Transforming finance for real economy change
This panel discussed the importance of making collaboration across the economy inclusive, with financial institutions and the real economy at different points in the journey. Businesses across the value chain face different risks and imperatives but are all trying to move in the same direction. We heard that every major organisation must have a transition plan. Financial institutions also need an engagement strategy working with portfolio companies to achieve targets; client engagement is an important opportunity to influence what happens to the real economy, to encourage companies to innovate and decarbonise. Finance institutions are starting to work with clients to turn targets into reality and to support them on their journeys.
Delivering a sustainable financial system
This panel explored how regulators and supervisors can help deliver a “meaningful transition that is effective and inclusive”. We were reminded that cross-border considerations must be considered and that sustainability frameworks such as the EU Taxonomy must work at an international level. As transparency will be key to transition to greener economies, regulators have a role in helping provide data and tools to help companies with disclosures. Another key role of regulators is to help with stress testing, and panellists highlighted that regulators must signal to civil society and businesses that global economies are going through a transition period. To drive this transition, companies must develop transition plans to green the existing economy, as well as growing the green economy.
Next steps to mainstreaming impact management
The panel on impact management highlighted the importance of standardising and mainstreaming of impact measurement, so that financial institutions can translate impact analysis into the understanding of how they can change the real economy whilst creating positive impacts for society, climate, and the environment. Banks can use the new Impact Protocol as well as Assessment Module for Institutional Banking launched during the panel to help with this process. This forms the basis for setting targets, as well as the monitoring and measurement of progress, which will require a change in culture within financial institutions.
From commitments to action: target setting for climate
This session explored the critical step between making a climate commitment and implementation of that commitment: target-setting. Bringing together the chairs of the Net-Zero Asset Owners Alliance and the Net-Zero Banking Alliance, and senior leadership of IKEA, the discussion covered the key requirements for accurate climate target-setting and delivery. Panellists also highlighted the requirements to implement and deliver against these targets, including needs from regulators, disclosure standards developers, and businesses in the real economy.
From physical risks to adaptation alignment
This session examined the barriers and potential solutions to globally address climate adaptation. The panel brought together experts in banking and climate financing to discuss risk and adaptation in the context of whether existing climate adaptation policies and roadmaps are aligned with the real-world challenges, particularly in vulnerable countries. The need for reliable and accessible data and cooperation across the private and public sector were highlighted as key areas of focus, to better inform and increase climate financing for adaptation.
Pathways to net-zero: Next steps and alignment for sectors
In this panel, speakers discussed how the majority of the net-zero alliances in GFANZ are pushing towards a net-zero future, and crucially, real-economy change. To achieve these targets, investors need more high-quality verifiable and testable sectoral datasets, as well as insights on what science tells them are the correct sectoral pathways to limit the global temperature rise to 1.5C. Immediate priorities for investors, companies and policymakers should be a decarbonised and energy-efficient electricity sector, rapidly reduced fossil fuel dependence and overall understanding that the ongoing energy security crisis must not be allowed to disrupt the long-term goal of net-zero emissions.
Disrupting sustainable finance through innovation
This session presented innovation in sustainable finance, the issues they seek to address, enablers and next steps in the achievement of the SDGs, particularly SDGs 14 (life below water) and 15 (life on land). There are innovations around frameworks, like the TNFD, which provides a community of practice to make nature prominent in the global market. Finance instruments like nature and climate performance-linked bonds, debt financing or instruments that help scaling up ocean infrastructure are also making waves. Speakers discussed innovation around data and how this supports evidence-based financial and business decision-making, and awareness of biodiversity impacts, for example the use of geospatial data now offered by RepRisk. Collaboration was emphasised as a great enabler of innovation with use cases that tie in technology, sustainable financing, and local communities. Speakers stressed the need to redesign business models for environmental and social returns in addition to financial returns, accurately appraise the risks associated with climate and biodiversity collapse to incentivise action and accelerate decision-making.
Launching the Principles for Responsible Banking Academy
This session marked the official launch of the Principles for Responsible Banking Academy — a training programme jointly developed by the Chartered Banker Institute, UNEP FI and the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH. German State Secretary for the Federal Ministry for Economic Cooperation and Development, Jochen Flasberth, highlighted the challenges financial institutions currently face in moving from pledges to concrete action due to the lack of capacity and welcomed the establishment of the Academy, which will benefit bankers in developing countries and emerging economies as well. The following dialogue, with Simon Thompson, CEO of Chartered Banker Institute and Eric Usher, Head of UNEP FI, then explored the relevance and importance of understanding sustainability issues for banking professionals, the goals of the PRB Academy, its uniqueness and future outlook.
Principles for Responsible Banking in action
This session brought together representatives from three PRB signatory banks (AIB, Investec and Suncorp Group) to speak about their journeys in implementing the framework. They shared experiences on how the Principles have helped them embed sustainability into their business strategies through working groups, the establishment of an effective governance structure, as well as impact analysis. The discussion then expanded to various impact areas, such as climate, financial health, inclusion, and nature, capturing their views and experiences in accelerating environmental and social action through the PRB.
Scaling blended finance
This panel presents the opportunities and challenges of scaling up blended finance to address sustainability issues. For global economies to make the crucial transition to stay below 1.5 degrees by 2050, investment in clean technologies and in low-carbon infrastructure, especially in emerging and developing country markets, must grow exponentially. Blended finance offers one of the best solutions, with multilateral development banks, private finance institutions and governments partnering to provide appropriate finance vehicles. Yet, far too much blended finance has not flowed to the best solutions. There is always a limited amount of concessional catalytic funding – it needs to fund the best global ideas no matter where they originate from. Developing countries are identifying their priority projects and in a climate context, nationally determined contributions (NDCs) need to be funded.
Data challenges and solutions
This panel addressed current data gaps and how they require a framework for clear and consistent reporting. Financial institutions and companies need to have a proper data management strategy in place and integrate linkages between data sets on factors like transition and physical risks to make ESG reporting as frequent and important as financial reporting. Data must fully be transparent from the reported source to the point of use; Bloomberg, OS-Climate and Watershed are solution-providers working at the forefront of these issues. The under-reporting of data can be addressed by overestimating such reported emissions to incentivise more accurate reporting. Further suggestions included: the collaboration of non-aligned entities to address these gaps, companies to disclose climate data in real time, increased investment in tools that consider climate risks, biodiversity impacts and support more frequent reporting. The ultimate goal is to ensure that the finance sector and companies can make fully informed decisions for people and the planet.
Insuring the Net-Zero Transition: Evolving tools and methods
In this panel, speakers discuss the tools that the insurance sector is developing to accelerate the net-zero transition. One year after the launch of the Net Zero Insurance Alliance (NZIA), two of its founding members (AXA and Swiss Re) were joined by the Partnership for Carbon Based Accounting (PCAF) to discuss their collaboration on the first global standard to measure insurance-associated emissions, scheduled to be launched later this year. The Science-Based Targets Initiative (SBTi) also joined the panel to announce that thanks to funding from Climate Arc, SBTi will be collaborating with NZIA on the development of its target-setting protocol. The panel touched on NZIA’s theory of change, the need to take action on both sides of the balance sheet and the need for leadership across the insurance industry.
Insuring the first- and last- mile
In this panel, speakers mentioned that micro, small, and medium enterprises (MSMEs) in vulnerable states are often aware of insurance but don’t see its value. Projects such as the Principles for Sustainable Insurance’s V-20 Sustainable Insurance Facility are aiming to change that. This panel brought together experts from across the globe to discuss real-life examples of how innovative insurance solutions can address the needs of MSMEs in vulnerable communities by using trusted distribution channels such as pre-existing cooperatives to demonstrate the value of insurance.
Nature positive insurance: next steps
The dual role of insurers as underwriters of risk and investors has great potential to ensure nature’s survival. The panellists stressed the need for insurers to take a systems-based approach to addressing biodiversity risk and embrace public private collaboration, including action from regulators. As demonstrated by recent work by the PSI, insurers play an important role in preventing loss and damage and driving change through insuring natural assets such as coral reefs.
Addressing social risks through finance
In this session, speakers stated that whilst the financial sector largely focuses on addressing environmental risks, it is important that banks contribute to the social aspects of the 2030 Agenda. Banking professionals from two PRB signatory banks and a human rights practitioner joined UNEP FI to discuss the role of banks in addressing social risks and the challenges they face in doing so. Panellists explored the unique positioning of banks to protect human rights, particularly in the area of financial health and inclusion, and dove deep into rising regulations in this area across the globe and what it really means to conduct human rights due diligence.
Financing nature-based solutions
This panel discussion explored a wide range of topics and perspectives surrounding how nature-related solutions can be financed. A sneak peek into the upcoming State of Nature Finance Report set the scene for the session and provided a glimpse into the urgent need to address societal challenges by working with nature. Banking professionals shared their experiences and challenges of scaling finance for nature-based solutions, and how addressing drivers of biodiversity loss helps them meet their net-zero commitment. A particular topic — sustainable food system and agriculture — was discussed to illustrate further action we can take to identify nature-based solutions. The upcoming Global Biodiversity Framework was also discussed by the panellists to provide an outlook on the topic for financial institutions worldwide.
Tackling plastic pollution through circular economy for insurers and banks
Plastic pollution is a huge threat to nature and people. This session brought together financial institutions, NGOs, and plastics pollution experts to dive into this critical issue. As UN member states are about to start negotiating the international binding instrument against plastic pollution agreed on earlier this year, panellists gave insights from their respective industries and regions into key provisions needed to allow financial institutions to play a central role in this economy-wide transition. They also addressed the challenges, risks, and opportunities that the finance industry faces in tackling the root causes of plastic pollution. De-risking investments, requiring full corporate disclosure of exposure and engaging with policymakers for enabling regulatory frameworks were some of the solutions given to unlock finance and move from a linear to a circular economy that would reduce GHG emissions while protecting nature and people.
Climate action in the MENA finance industry: On the road to COP27 and COP28
Speakers discussed the emerging policy and market developments in the MENA region, the regulatory and national strategies to align with sustainability goals, and plans and expectations on the role of the MENA finance sector ahead of COP27 in Egypt and COP28 in the UAE.
Mobilising climate finance for loss and damage in Africa
In this panel, speakers dissected what loss and damage means for different entities (households, businesses, governments), the barriers to loss and damage finance in Africa, available financing options, and what success looks like in terms of loss and damage at COP27.
Implementing climate targets in APAC across Net-Zero Banking Alliance priority sectors
This session gathered representatives from Asia’s leading banks that are NZBA signatories to reflect on key steps for the implementation of climate targets and challenges and opportunities in doing so in the Asia Pacific region.
Aligning international taxonomies on sustainable finance
In this session, speakers discussed the current state of play of relevant taxonomies globally, including EU and ASEAN taxonomies, and the interconnections between them, including the Common Ground Taxonomy between EU and China, and assessed how taxonomies can be further aligned.
EU Sustainable Finance Regulation, state of play and way forward: the impact on financial institution
This session explored the current state of play of relevant EU regulation from the perspective of regulators and financiers, including the EU Taxonomy, Banking Regulation, and sustainability disclosures, how financiers are responding, and how upcoming regulatory adjustments will affect the market.
- For more information, full agenda and speaker line up, please click here
- The Global Roundtable was supported by Platinum Sponsor, Societe Generale and Gold Sponor, RepRisk.