17 July, 2019, Geneva – A recent United Nations report estimated that it will take $140 to 300 billion to strengthen the resilience of societies and economies to climate change, and reduce the vulnerability of the planet’s natural resources. To accelerate adaptation action around the globe, the Global Commission on Adaptation (GCA) was launched in October 2018 by the 8th UN Secretary-General, Ban-Ki Moon, co-chair of the Bill and Melinda Gates Foundation, Bill Gates, and World Bank CEO, Kristalina Georgieva. The Commission aims to elevate the political visibility of climate adaptation, while encouraging bold solutions such as smarter investments, new technologies and better planning. It has the support of 19 convening countries including China, Canada and the UK, as well as seven members of the V20 group of countries vulnerable to the impacts of climate change, including Bangladesh and the Marshall Islands. A further 29 Commissioners represent all sectors of the globe and all sectors of development and industry.
At the UN Secretary-General’s Climate Summit in New York in September 2019, the Commission will present the recommendations of the GCA’s initial flagship report. The report will make the case for prioritising climate change adaptation from the local to the global level.
Today, UNEP Finance Initiative launched a technical background paper on adaptation finance to inform the GCA report. A respected author team led by Stacy Swann and Alan Miller of Climate Finance Advisors drafted the paper, ‘Driving Finance Today for the Climate Resilient Society of Tomorrow’ and were advised by a Review Panel, consisting of experts from banking, investment, insurance, academia and government.
Many efforts have been made to tweak the financial system to better integrate climate change into decision making, but the necessary best practice, regulations, rules and standards are currently weak and ill-defined. The paper identifies the barriers to scaling up financing for adaptation which include weak policies and conventions in the financial industry and a low technical capacity for climate risk management amongst others. There is also a range of opportunities to accelerate the investment required to prepare the planet for climate change, though these face additional barriers such as the perceived lack of private benefits and the immaturity of business models. This paper presents a set of six recommendations, with illustrative case studies, to promote resilience investment:
- Accelerate and promote climate-relevant financial policies;
- Develop, adopt, and employ climate risk management practices;
- Develop and adopt adaptation metrics and standards;
- Build capacity among all financial actors;
- Highlight and promote investment opportunities; and
- Use public institutions to accelerate adaptation investment.
Collectively, they offer a program that is ambitious, actionable, and can directly impact how finance can be unlocked for adaptation and resilience.
Following the launch of the GCA report, the Global Commission will launch a Year of Action up to the end of 2020. UNEP FI intends to support this Year of Action within the framework of its annual programme, by continuing development of the physical risk component of the TCFD pilots for banks and investors, while encouraging financial institutions to commit to physical risk disclosure. We also aim to work with financial institutions across the sector to commit to integrating climate risk into decision-making. The Principles for Sustainable Insurance team are also working on a number of initiatives to open up opportunities for microinsurance and nature-based insurance solutions to improve resilience in vulnerable regions.
Download the UNEP FI / GCA background paper on adaptation finance here.
Listen to the webinar held for the launch of the paper here.
Find more information on the Global Commission on Adaptation here.
Contact Paul Smith for more information.