COP26 Logo 'UN Climate Change Conference UK 2021 In partnership with Italy'

03.11.2021

Mission Innovation-Breakthrough Energy collaboration agreement

At COP21, government leaders launched Mission Innovation (MI) and Bill Gates launched Breakthrough Energy (BE), both committing to accelerate investment into clean energy technologies and stimulate collaboration between the public and private sectors. Over the last six years, BE and MI have worked closely to advance shared goals, expand into new focus areas, and increase funding for the research, development and demonstration of critical clean energy solutions. 

In 2021, a second phase of Mission Innovation was launched to deliver a decade of action and investment in research, development and demonstration to make clean energy affordable, attractive and accessible for all. This includes Missions, which are public-private innovation alliances targeting goals that will lead to tipping points in the cost and scale of clean energy solutions. 

In 2021, BE launched the Catalyst program, whose mission is to drive down the green premium for climate technologies and accelerate market adoption. Catalyst’s goal is to make the global energy transition more affordable and achievable for high-, middle-, and lowincome countries across the world.

BE and MI are expanding their partnership and will work together to advance public and private sector collaboration to accelerate critical clean energy technologies towards  commercialization. This collaboration will build upon our work to significantly increase clean energy RD&D and early-stage investment efforts, which both initiatives will continue to promote as a critical part of the pathway to achieve the Paris goals. Under this expanded partnership, BE and MI will help identify project funding opportunities to develop new technologies around the world, maximise the impact of investments, and strengthen the clean energy innovation ecosystem. 

Areas of Collaboration

Building on the recent partnerships with the European Commission, the European Investment Bank, the U.S. Department of Energy, and the United Kingdom, BE and MI will work to expand collaboration with governments across North and South America, Europe, Asia, Africa, and the Middle East. Together, BE and MI will collaborate in areas that support the goals of both initiatives, including: 

  • Facilitate collaboration and co-funding opportunities through BE Catalyst with individual MI member governments, with a focus on middle- and low-income countries. BE and MI will identify high impact projects globally that present opportunities for support from the public and private sectors. This collaboration will focus on financing first-of-akind and early commercial demonstration projects, which are often unable to access funding from traditional investors due to their lower return profiles, technology risk and insufficient market demand. BE and MI will collaborate to accelerate funding into these high impact projects, which can drive down the green premium, de-risk future deployments and speed up market adoption.  
    • Catalyst will mobilize private sector capital to co-fund projects with governments in these geographies and crowd in further investment.  MI will work with member countries to connect projects in these geographies to Catalyst’s Request for Proposal process. 
    • This joint effort, with a focus on middle-and low-income countries, will help build critical climate infrastructure, improve global technology transfer, and generate economic development. 
  • Advance technology development, demonstration, and deployment. MI and BE will work together to accelerate clean energy technologies towards commercialization in shared priority areas, starting with green hydrogen, sustainable aviation fuel, direct air capture, and long duration energy storage. In particular, this will focus on the expansion and development of public-private co-funding models to support the goals of the Clean Hydrogen, the Green Powered Future, the Carbon Dioxide Removal, the Net Zero Emission Industry Demo, and the Integrated Biorefineries Missions as well as the Innovation for International Sustainable Aviation Fuel initiative.  
  • Share best practices, knowledge, and insight. BE and MI will work to disseminate lessons learned around innovation and finance, programmes and policies that can help countries around the world develop, demonstrate and deploy low carbon solutions. This knowledge sharing may also help the formulation of MI members’ National Innovation Pathways.  
  • Measure impact and track technology progress. BE and MI will promote new ways to measure the impact of innovation investments and track technology frontiers, including those laid out in BE’s Emerging Climate Technology Framework and MI’s Insights Module. Alignment around key metrics and data will enable the global community to track progress toward goals including technology progress, catalytic investment and green premium reductions. 

To ensure continuity in their collaboration, BE and MI will each identify a person to act as the focal point for the implementation of this collaboration.  

This non-binding collaboration does not commit BE nor MI to additional financial or human resource obligations.  

In the mutual interest of the collaboration neither BE nor MI will disclose document or information shared by the other party that should reasonably be recognized as confidential or sensitive, given the nature of the information and/or the circumstances of disclosure.

BE and MI recognize that this relationship will have an evolving nature. Further activities, priorities, and modalities could be identified jointly based on mutual benefits and in the pursuit of common interests.

COP26 Logo 'UN Climate Change Conference UK 2021 In partnership with Italy'

03.11.2021

COP26 World Leaders Summit- Presidency Summary

On November 1st and 2nd, 120 world leaders gathered in Glasgow to kick start a decade of accelerated climate action.

Leaders were joined by civil society, international organisations, businesses and youth to mark the start of the 26th UN Climate Change Conference of the Parties. Over two days featuring national statements and a series of high-level meetings and events, Heads of State and Government were clear in their determination to take ambitious action to tackle climate change and seize the opportunities of a clean and resilient transition; at COP26 and through the critical decade ahead.

Leaders assembled against the backdrop of the extraordinary challenge of the COVID-19 pandemic and the consequences of climate change already being experienced across the world. Urgency in overcoming this collective challenge was front and centre of discussions, emphasised by the prominence of many of the world’s poorest and most climate vulnerable countries. In the face of this crisis, leaders from across the world came together in solidarity.

Leaders made clear that climate change is a global problem. The world is welcoming in a new era of economic and political partnership with climate action at its heart. The task of the decade will be to deliver the finance, resources and tools to rapidly deliver climate action at scale.

Leaders made clear their expectation for COP26 to accelerate action by 2030.

While recognising every country’s unique circumstances and responsibilities, leaders from all regions spoke about the need to urgently address the gaps in ambition – on mitigation, adaptation and finance – and their determination to do so at COP26 and beyond. Statements from the High Ambition Coalition and Climate Vulnerable Forum both added strong calls for greater ambition.

Across the Summit, leaders outlined what must be achieved in Glasgow; sending a signal to negotiators to work together to accelerate climate action in this crucial decade, stressing the need to drive progress on all issues and conclude the Rulebook to support delivery of the Paris Agreement goals.

Many leaders spoke about the vital importance of charting a path to keep the prospect of limiting global temperature rise to 1.5°C within reach; including by closing the gap between the current Nationally Determined Contributions to 2030 and requirements of science; revisiting and updating them as necessary.

They issued clear calls to continue to scale up climate finance from all sources, including urgently delivering the $100bn per year goal and deepening work across the financial system to align financial flows with the Paris Agreement and Sustainable Development Goals. Additionally, they called for agreement on an inclusive approach for setting a new collective quantified goal beyond 2025, fit for purpose for delivering the Paris Agreement. Many spoke about the pressing need for predictable and accessible finance. Some raised the importance of enhanced action in technology development and transfer, and capacity building.

Leaders raised the importance of adapting to the impacts of climate change as a matter of survival and the need to implement the Global Goal on Adaptation. Many highlighted the need for a step-change in finance for adaptation and for the COP26 outcome to show a collective aim to achieve this. Some called for at least a doubling of current funding, towards the balance collectively agreed in Paris.

Many leaders stressed the growing reality of loss and damage associated with climate change, and called for operationalisation of the Santiago Network and greater efforts to ensure international finance and technical assistance is scaled up. 

The Summit showed the Paris Agreement is working and made progress in key areas.

While recognising the need to continue to go further and faster, leaders set out how their countries are doing more; demonstrating how the Paris Agreement is working to increase ambition – on mitigation, adaptation and finance – and how they are acting on the economic and social opportunities this presents.  

They outlined their national targets to reduce emissions. 151 parties have now submitted updated Nationally Determined Contributions, with a further 8 announcing their intention to do so. Almost 90% of global emissions and over 90% of global GDP is now covered by mid-century net zero or carbon neutrality commitments, rising from just 30% of global GDP at the end of 2019.

Going beyond headline targets, leaders explained the steps that their countries are taking to deliver these commitments; including action on coal, cars, cash and trees, among others.

A significant number of leaders spoke about ending coal power. 42 countries have set coal phase out dates and international public finance for coal is coming to an end.

There was a clear commitment to working together to achieve climate aims, including with the private sector, international organisations and civil society. Significant announcements included:

  • Over 40 leaders joined the Breakthrough Agenda, a 10-year plan to work together to create green jobs and growth globally, making clean technologies and solutions the most affordable, accessible and attractive option before 2030 – beginning with power, road transport, steel, hydrogen and agriculture.
  • Over 120 countries covering more than 90% of the world’s forests endorsed the Glasgow Leaders’ Declaration on Forests & Land Use committing to work collectively to halt and reverse forest loss and land degradation by 2030, backed by the biggest ever commitment of public funds for forest conservation and a global roadmap to make 75% of forest commodity supply chains  sustainable.
  • A Just Energy Transition Partnership was announced to support South Africa’s decarbonisation efforts; a powerful example of collaboration between an emerging economy and international partners.
  • The launch of the Global Methane Pledge saw over 100 countries committing collectively to reduce global methane emissions by 30% by 2030.

Across the two days, it was evident that finance for low-carbon and resilient development continues to increase. However, leaders were clear that this remains far short of the levels needed. Many leaders expressed disappointment that the $100 billion goal would not be met in 2020. Developed countries outlined how the goal will be delivered by 2023 at the latest. Several made new increased climate finance commitments, including for adaptation, meaning almost all have now come forward with new pledges to 2025. 

Many leaders highlighted the severe fiscal pressures they face, exacerbated by the combined threats of climate change and COVID-19. They called for the financial system, including the International Monetary Fund and Multilateral Development Banks, to build on recent progress with greater efforts to respond to the needs of climate vulnerable and developing countries. Several countries outlined how they are supporting a resilient and sustainable recovery from COVID-19 and will increase investment and partnerships for clean and green infrastructure through Build Back Better World.

Leaders highlighted the need for all countries to urgently scale up action to adapt to climate change. A number of developed countries were clear about their commitment to achieve a balance between mitigation and adaptation in their climate finance, including through a new Champions Group on Adaptation Finance, and with some committing to 50% adaptation finance. Further support for adaptation was showcased through the African Adaptation Acceleration Programme and a new Infrastructure for Resilient Island States fund. Many leaders spoke about their national and locally-led plans, with 32 countries now having submitted Adaptation Communications or National Adaptation Plans, now representing more than 2 billion people, helping share best practice and mobilise action.

A range of participants representing civil society, youth, indigenous peoples, businesses and international organisations contributed actively throughout the Summit, demonstrating the role that all actors have to play in raising ambition and building a net zero and resilient future.

Leaders sent a clear signal that COP26 must keep 1.5C in reach.

The Prime Minister of the UK, Boris Johnson, and COP President, Alok Sharma, called on leaders to empower negotiators to deliver an outcome that responds to the best available science and the demands of people the world over, to urgently accelerate climate action and ensure that finance is flowing to support this transition, especially for the poorest and most vulnerable.  

The United Kingdom, as COP26 Presidency, in partnership with Italy, looks forward to working with all Parties and Observers, building on the momentum and direction set out by leaders to deliver a successful outcome in Glasgow, that leaves no one, and no issue, behind.

COP26 Logo 'UN Climate Change Conference UK 2021 In partnership with Italy'

03.11.2021

Country Platforms Action Plan, from Mark Carney, UN Special Envoy on Climate Action and Finance and the Prime Minister’s Finance Adviser for COP26

Summary

The scale of investments to achieve net zero consistent with 1.5 degrees is estimated to be between $100-150 trillion over the next three decades. The need is greatest in emerging and developing countries, which will require two-thirds of total investment,1 including total annual transition financing needs rising to $1 trillion by the latter half of this decade. At the same time, over $130 trillion of private sector capital through the Glasgow Financial Alliance for Net Zero (GFANZ) is now committed to align its activities with net zero, and is increasingly targeting Paris-aligned lending and investments.

The challenge is to match this enormous finance with viable projects in emerging markets and developing countries (EM&DCs). There are a number of longstanding issues, including unfavourable domestic policy environments, blended financing instruments that are either too small scale or which mobilise only limited private capital, and a lack of investable projects connected to robust long-term decarbonisation strategies.

Bridging the financing gap in EM&DCs requires a radical change to the international financial architecture. Specifically, it requires building new country platforms which deploy blended finance at scale, leveraging private finance at significant multiples and connecting stand alone private finance with NDCs. These ‘Country Platforms’ would provide a single focal point to channel technical assistance and public and private finance to support the delivery of Paris-aligned NDCs in EM&DCs.2 They would coordinate and scale all elements including, critically, standalone private finance to major EMs for all aspects of transition finance including the wind-down of stranded assets. Country platforms could help mobiliser $1 trillion per annum of new private capital flows by middle of the decade.

Background: Barriers to Financing Climate

Investing in EM&DCs can provide high returns relative to more developed markets, but the overall risk/return profile often does not meet investor expectations. Mobilising private investments into climate adaption and resilience sectors (such as agriculture, forests, resilient infrastructure) also faces additional challenges, given the nascent nature of many of these industries and, more broadly, the lack of reliable revenue streams.

To scale up investment, investors need:

(i) Strong institutions, governance and reliable macroeconomic management.

(ii) Policy stability, commitment to low-carbon solutions and contract enforceability: Low-carbon projects are particularly vulnerable to policy risk, such as the ability to predict and rely on stable tariffs, due to declining input costs and a reliance on government subsidies.

(iii) Increased market access, a viable commercial partner and ability to scale. Technical skills to engage with investors and execute commercial agreements are important.

(iv) Depth in local financial markets. Local bank markets that can provide financial services, such as currency, interest rate swaps, access to listed markets, and even support for a robust green bond markets are important for international investors.

(v) Currency stability. Mismatches between the currency denomination of a project’s costs and the denomination of its revenues presents extra costs and risks where instruments needed to hedge those risks are lacking.

(vi) Accurate performance data and benchmarks: a lack of data is hindering accurate risk-pricing and leading to risk misperception.

A number of these barriers can be overcome with the right toolkit of public support. But, to date, attempts to mobilise private climate finance into developing countries has been piecemeal, and have not achieved the scale required to effectively respond to the challenge of financing developing countries’ climate plans. This needs to be matched by a coordinated response from the private sector. 

Proposal: An enhanced model of country platforms

This new model of country platforms builds on recent efforts. First, the World Bank has advocated country-led and country-owned platform models since 2017, reaffirming this commitment in the Joint MDB Statement issued at COP26, and the G20 Finance Ministers endorsed a Reference Framework for Effective Country Platforms in early 20203. Second, the private-sector led CFLI is focused on piloting this type of coordinated, country platform activity by convening leading private sector financial institutions and corporates, alongside governments and development finance, to catalyse new private financing activity and long-term enabling environment strengthening select markets and priority sectors4. These approaches can be combined and linked to NDC commitments in country platforms that supercharge climate finance flows. With over $130 trillion of private finance focused on achieving net zero, country platforms must integrate Paris-aligned NDCs to attract capital at scale. Projects that are consistent with long term country strategies that are certified as Paris aligned are more likely to attract private capital and less likely to be subject to project risks, including changes in regulation.

Specific country platforms will need to be owned and developed from the outset by beneficiary governments (supported by bilateral donors, MDBs, DFIs and private sector coalitions) to deliver appropriate tailored solutions dependent on the specific beneficiary country needs.

Country platforms could deliver $1 trillion per annum of new private capital flows to EMDs by middle of the decade. These will:

  • Combine ambitious NDCs and tailored projects to help achieve them. For example, financing projects across the value chain that support projects such as coal phase out, steel decarbonisation, renewable power, and reforestation. With private finance focused on achieving net zero, country platforms must integrate Paris-aligned NDCs to attract capital at scale. Projects that are consistent with long term country strategies that are certified as Paris aligned are more likely to attract private capital and less likely to be subject to project risks, including changes in regulation.
  • Address both upstream and downstream barriers to investment: Developing a pipeline of projects may require barriers across the investment chain to be overcome, including upstream5 – such as the regulatory environment or other underlying factors that discourage investment – and downstream,6 including connecting projects to investors through appropriate financing structures.
  • Access capital at scale from the private sector: Leverage GFANZ members to make clear commitments from private capital to finance net zero aligned projects in emerging and developing economies. Coordinate efforts across initiatives such as Mike Bloomberg’s Climate Finance Leadership Initiative (CFLI), HRH’s Sustainable Markets Initiative (SMI) and President Macron’s One Planet Lab to ensure a single focal point for action.
  • Coordinate financing and certify Paris-alignment: Provide a forum to coordinate public/private finance, including bringing in the expertise of key institutions, particularly MDBs, to develop bespoke blended finance structures and certify Paris alignment of projects. This includes country-led governance (and external support, as appropriate) to oversee, steer, and coordinate donor/private sector activity in line with development and decarbonisation strategies,
  • Utilise innovative financing structures: Providing access to structures such as voluntary carbon markets, which have the potential to scale to $150 bn per year of new investments, with vast majority flowing to emerging and developing economies. Connecting these to platforms where projects are demonstrably aligned to, both Paris and local development priorities will help ensure high integrity.

In practice, governance models will need to be tailored to country specificities, and draw on relevant existing initiatives and institutions that are active in this space (see Annex 1 for a list of some of these key initiatives that could be included). Specific lead institution(s), for example MDBs, could be designated to support beneficiary governments with coordination of platforms.

Scale blended finance through MDBs

As a key component of work on country platforms, MDBs should identify and scale up solutions to mobilise private capital.

MDBs are uniquely placed to de-risk projects and mobilise private finance, but thus far the results have been modest with only $8bn directly mobilised in 2019, just 11% of total climate finance contributed and directly mobilised from advanced to developing economies. Actual investments will, of course, depend on the specific projects and the overall investment environment within the recipient countries, including the credibility of NDCs, but these conditions are more likely to develop if the sufficient financing capacity is in place.

MDBs should identify and be prepared to dramatically scale up blended finance vehicles, instruments and facilities that overcome these issues and support significant mobilisation of private capital. Potential candidates include the IFC’s Managed Co-Lending Portfolio Program and the AFD’s Room2Run Synthetic Securitisation Program, as well as platforms like the Global Infrastructure Facility.

Consideration should be given to the development of new first loss structures that reduce macro risks.

MDBs should focus on:

  • Leveraging private finance: Access to concessional resources will help mobilise private finance through blended structures. Concerns about the effectiveness of the existing architecture – including overuse of blend for pre-investment activities versus underwriting higher-risk but potentially higher-impact post-investment losses – are hampering action. MDBs should review: whether fewer but larger and more coordinated blending pools would be more effective; how to improve adherence to the blended finance principles; and how MDBs can more effectively access and coordinate with organisations designed to pool and leverage private capital (i.e. GCF Private Sector Window, EFSD+ and the CIFs.)
  • Scaling sector “platforms” and investment funds: groups (such as infrastructure finance and development organisations) focused on specific sectors have the capital and expertise required to take on early stage risk. MDBs should partner with these firms to develop commercially focused low-carbon “sector” solutions, or “platforms”. Development finance has previously been used in backing and creating such sector platforms (e.g. CDC’s investments in Globaleq, GridWorks and Ayana). MDBs could also target mobilisation of large pools of currently underutilised capital such as domestic pension and insurance funds into these vehicles – building their exposure to this new asset classes.
  • Wholesaling bankable projects: by preparing, originating and structuring them before selling them onto institutional investors, thereby preserving balance sheet capacity of MDBs.
  • Issuing green MDB bonds and supporting green bond issuances in developing markets. MDBs should use their expertise to provide technical assistance to developing countries issue green bonds. This could include support on pipeline development, transparent governance and outcome tracking. MDBs could consider the development of an investment vehicle that pools investments across a number of Green Bonds, making it more feasible for private sector investors to participate, as well as de-risking exposure to single country risks. In the longer term, any agreements by shareholders to provide additional capital to the MDBs could also support increased mobilisation.
(ii) Objectives and suggested actions

There is now a unique need and opportunity to reorganise public and private sector cooperation to support green recovery and climate action in EM&DCs. The actions proposed here should be further refined and delivered through willing bilateral and multilateral donors and private sector coalitions:

At COP26

  1. Secure high-level support from key partners to develop this concept further post-COP, including setting up an action-oriented working group to deliver platforms in 2022, and reinvigorating work on country platforms at the G20 level, building on existing work under the Saudi Presidency (G20 Reference Framework for Effective Country Platforms).

2022

  1. Key partners develop and begin implementing country platforms in pilot countries, with secretariat led by an institution appropriate for that country to be discussed across the IFIs in partnership with the country concerned.
  2. G20  defines effective country platforms using the most effective high multiplier blended finance vehicles and an updated G20 Reference Framework to showcase best practice for working with the private sector.
  3. Initiate pilots in key emerging markets to prove the concept and begin the large scale flow of finance.

Annex 1: Examples of existing initiatives covering key elements of country platforms

While no one platform or initiative covers all of the proposed scope, some elements of country platforms already exist in a form that could be learned from and built upon. For example:

Technical assistance in project preparation:

Climate Finance Accelerator (CFA): The CFA supports emerging markets to turn their NDCs into a pipeline of bankable projects, through capacity building for project developers. This supports them to understand how to structure their programmes to attract private and public sources of finance, and helps match them with investors. The CFA currently operates in South Africa, Nigeria, Turkey, Peru, Mexico, and Colombia.

Global Infrastructure Facility: The Global Infrastructure Facility (GIF), a G20 initiative, is a global collaboration platform that brings together donors, development finance institutions, country governments, with input from private sector investors and financiers, to build bankable pipelines of infrastructure projects that attract private financing. It works with multiple MDBs to explicitly focus on private capital mobilization, focused on providing technical assistance and project prep for large infrastructure projects.

Private sector coordination with local governments to address barriers to private capital mobilisation:

Climate Finance Leadership Initiative (CFLI) Country partnerships: Partnering with country governments and multilateral DFIs, CFLI country partnerships bring together local and international financial institutions to identify and address sector-specific barriers to private finance mobilisation. This includes targeting regulatory reforms to enable private capital mobilisation over the longer-term. The first CFLI Partnership (India) was launched in September 2021.

Multilateral donor coordination to support climate finance:

Taskforce on Access to Climate Finance: Co-chaired by the UK and Fiji, the Taskforce on Access to Climate Finance aims to address barriers to access, constraints on delivery and insufficient coherence in donors’ offers by developing a new approach to climate financing, which will align support behind the national climate action plans of developing country partners and match those commitments with a coordinated offer from bilateral and multilateral partners.

NDC design and implementation

NDC partnership: The NDC Partnership works directly with national governments, international institutions, civil society, researchers, and the private sector to help developing countries deliver NDC goals by turning them into action plans, integrating them into all parts of government and co-ordinating donors to provide support The NDC Partnership is co-chaired by Jamaica and the UK, and has more than 180 members, including developed and developing countries, MDBs and UN bodies.

Packaging sustainable infrastructure projects for private sector investors

Fast Infra: The goal of Fast Infra (‘Finance to Accelerate the Sustainable Transition – Infrastructure’) is to significantly scale up private sector investment in developing world sustainable infrastructure, including through sustainable infrastructure labelling and targeted financial interventions. Participants include banks, asset managers, multi-lateral development banks, national development banks and NGOs.

1 Based on research to be published by Race to Zero and GFANZ with analysis by Vivid Economics

2 Meaning: consistent with articles 2.1a-c of the Paris Agreement, including pursuing efforts to limit the temperature increase to 1.5 degrees Celsius above pre-industrial levels, and increasing the ability to adapt to the adverse impact of climate change and foster climate resilience.

3 Defined as “voluntary country-level mechanisms, set out by governments and designed to foster collaboration among development partners, based on a shared strategic vision and priorities.”

4 https://www.gov.uk/government/news/joint-statement-by-government-of-india-uk-government-and-the-cfli-on-mobilising-climate-finance-in-india

5 The IFC define ‘upstream’ activities as those that ‘occur before the traditional investment cycle and are necessary precursors to an investment,’ and interventions are targeted ‘at creating the conditions for a private sector investment that otherwise would not have occurred if left to market forces alone.’  https://www.ifc.org/wps/wcm/connect/topics_ext_content/ifc_external_corporate_site/upstream/faqs

6 As defined by the IFC, the downstream stage covers (iv) project structuring, (v) transaction support, and (vi) post-implementation support. https://ieg.worldbankgroup.org/sites/default/files/Data/Evaluation/files/IFCClientEngagement.pdf

7 See, for example, principles outlined on pg. 8 of the DFI Working Group on Blended Concessional Finance for Private Sector Projects https://www.ifc.org/wps/wcm/connect/73a2918d-5c46-42ef-af31-5199adea17c0/DFI+Blended+Concessional+Finance+Working+Group+Joint+Report+%28October+2019%29+v1.3+Report+.pdf?MOD=AJPERES&CVID=mUEEcSN

COP26 Logo 'UN Climate Change Conference UK 2021 In partnership with Italy'

03.11.2021

Network for Greening the Financial System’s Glasgow Declaration

From 8 founding members in 2017, we have quickly expanded to now include 100 central banks and supervisors and 16 observers, who together form the Network for Greening the Financial System (NGFS). We are a global and inclusive network, consisting of members from developed, emerging and developing economies. 

On the occasion of the 2021 United Nations Climate Change Conference (COP26), we reiterate our willingness to contribute to the global response required to meet the objectives of the Paris Agreement, and, to that end, we will expand and strengthen our collective efforts towards greening the financial system. 

Following its Call for Action report published in April 2019, the NGFS has developed a broad set of analyses and practical tools to share knowledge and best practices, notably in the fields of prudential supervision, climate scenario analysis, responsible investment, the inclusion of climate-related considerations into monetary policy frameworks, data gaps, and building awareness and intellectual capacity. 

Looking ahead, and in light of the urgency and seriousness of climate change and environmental issues, we will expand and strengthen our collective efforts to improve the resilience of the financial system to climate-related and environmental risks, and encourage the scaling up of the financing flows needed to support the transition towards a sustainable economy. 

In the coming years, the NGFS will then: 

  • further enhance and enrich its climate scenarios, thus providing on a regular basis an important public good for a broad range of stakeholders, both public and private; 
  • deepen its analysis on integrating climate change considerations into monetary policy strategies and frameworks, in the context of the mandates of its members; 
  • intensify the work to bridge the data gaps that currently hinder the identification, management and mitigation of climate-related risks; 
  • supplement the set of NGFS practical guides with guidelines on TCFD-aligned reporting for central banks; 
  • facilitate uplift in supervisory capabilities and the global consistency of supervisory practices; 
  • step up its efforts on capacity building, with a particular focus on members from emerging and developing economies, to support members’ progress in addressing climate-related and environmental risks and in implementing the NGFS recommendations; 
  • keep exploring emerging topics such as the impact of the loss of biodiversity or the risks associated with climate-related litigation, and work towards addressing them, in the context of the mandates of its members; 
  • continue to cooperate with standard-setters, other policy makers, the financial sector, academia and other relevant stakeholders to keep on distilling best practices, identifying challenges and solutions and avoiding duplication of work.

The collective achievements of the NGFS help to foster action by its members. A large number of NGFS members are taking the opportunity of the COP26 to publish an individual pledge or strategy, while others have recently released documents detailing their domestic agenda, or plan to do so soon. Taken together, these clearly demonstrate that our community is determined to act as a leading force.

COP26 Logo 'UN Climate Change Conference UK 2021 In partnership with Italy'

03.11.2021

Glasgow Financial Alliance for Net Zero’s COP26 statement

Capital committed to net zero now at over $130 trillion, up from $5 trillion when the UK and Italy assumed COP26 Presidency.

Today, through the Glasgow Financial Alliance for Net Zero (GFANZ), over $130 trillion of private capital is committed to transforming the economy for net zero.1 These commitments, from over 450 firms across 45 countries, can deliver the estimated $100 trillion of finance needed for net zero over the next three decades.

To support the deployment of this capital, the global financial system is being transformed through 24 major initiatives for COP26 that have been delivered for the summit. This work has significantly strengthened the information, the tools and the markets needed for the financial system to support the transformation of the global economy for net zero.

New analysis, commissioned by the UN High Level Climate Action Champions, finds that the private sector could deliver 70% of total investments needed to meet net zero goals.2

In its progress report published today, GFANZ announces that financial sector commitments to net zero now exceed $130 trillion, a 25-fold increase under the UK and Italian Presidency.3

Now firms across the entire financial spectrum – banks, insurers, pension funds, asset managers, export credit  agencies, stock exchanges, credit rating agencies, index providers and audit firms – have committed to high ambition, science-based targets, including achieving net zero emissions by 2050 at the latest, delivering their fair share of 50% emission reductions this decade, and reviewing their targets towards this every five years. All firms will report their progress and financed emissions annually.

The progress report also outlines the ambitious body of work underway – led by GFANZ CEOs – to address some of the biggest climate finance challenges, including defining net zero pathways for carbon-intensives sectors, aligning on what constitutes a robust transition plan for corporates and financial institutions, and a sector-wide plan to mobilise capital needed for decarbonisation in emerging markets. Collectively, this work will accelerate the implementation of net zero commitments and help to rapidly scale capital flows to support the net zero transition.

It comes as UK Chancellor, Rishi Sunak, announced today new requirements for firms to publish net zero transition plans setting out how they will decarbonise through 2050. This follows calls from GFANZ for G20 countries to implement policies to unlock and accelerate capital to support the transition, including mandatory net zero transition plans.4

Already, firms are turning ambition into action that will align their portfolios with 1.5°C. Over 90 of the founding institutions of GFANZ have already delivered on setting short-term targets, including 29 asset owners that have committed to reducing portfolio emissions by 25-30% by 2025, as well as 43 asset managers that have published targets for 2030 or sooner.5 And the first targets have also been published by Net Zero Banking Alliance members.

The 24 other major finance initiatives, led by Mark Carney as part of the private finance priorities for COP26, will help transform the financial architecture by mainstreaming and scaling: climate-related reporting; climate risk management; climate-related investment returns and the mobilisation of private finance to emerging and developing economies.6

Today, the IFRS Foundation, the international accounting standard body, announces the establishment of a new International Sustainability Standards Board to develop globally consistent climate and broader sustainability disclosure standards for the financial markets. This work has been welcomed by Finance Ministers from over 40 countries stretching across 6 continents and follows support from the G7 and others to make climate disclosures mandatory.

Through the work of the Network for Greening the Financial System climate risk management is also being transformed. Thirty-eight central banks, in countries comprising 67% of the world’s emissions, have committed to climate-related stress tests to review the resilience of the world’s largest financial firms in the face of several climate-related risks. And 33 central banks and supervisors, representing 70% of the world’s emissions, have committed to issuing guidance to firms on managing climate-related financial risks.

And to measure more accurately the alignment of lending, investment and underwriting with net zero, the Taskforce on Climate-related Financial Disclosures (TCFD) has published guidance on metrics, targets and transition plans.

Finally, for COP26, GFANZ Co-Chair Mark Carney is publishing a new plan on how to scale private capital flows to emerging and developing economies. This includes the development of country platforms to connect the now enormous private capital committed to net zero with country projects, scaling blended finance through MDBs and developing high integrity, credible global carbon markets.7

GFANZ is supporting these mobilisation efforts and has identified an initial set of five catalytic initiatives to accelerate the transition in these countries, based on their scalability and potential impact. In doing so, GFANZ has committed to bring together technical expertise and balance sheets to scale capital commitments ahead of COP27.8

GFANZ is taking a number of measures to accelerate the global transition to net zero beyond COP26 with new leadership, announcing that UN Special Envoy on Climate Ambition and Solutions and Race to Zero Ambassador Michael Bloomberg will join UN Special Envoy Mark Carney as co-chair of GFANZ. Mary Schapiro, Head of the Secretariat for the Taskforce on Climate-related Financial Disclosures and former Chairman of the US Securities and Exchange Commission, will be the vice-chair. They join UN High Level Champion Nigel Topping in the GFANZ leadership team. A new permanent secretariat will have a presence in Europe, the Americas, Africa, and Asia. GFANZ also unveils it will periodically report on its work to the G20’s Financial Stability Board.

Mark Carney, UN Special Envoy for Climate Action and Finance and COP26 Private Finance Advisor to PM Johnson said:

The architecture of the global financial system has been transformed to deliver net zero. We now have the essential plumbing in place to move climate change from the fringes to the forefront of finance so that every financial decision takes climate change into account. Only this mainstream focus can finance the estimated $100 trillion of investment needed over the next three decades for a clean energy future.

The rapid, and large-scale, increase in capital commitment to net zero, through GFANZ, makes the transition to a 1.5°C world possible. To seize this opportunity, companies must deliver robust transition plans and governments set predictable and credible policies. This will give finance the confidence to invest, pulling forward climate actions and smoothing the transition to net zero, driving growth and jobs upwards, and forcing emissions downwards. Let’s work together to seize this opportunity.

Nigel Topping, UN High Level Climate Action Champion for COP26 said:

To keep 1.5°C within reach, we need the owners, managers, lenders, and underwriters of capital to realign their business models with the climate science. The core of the financial system is now publicly committed to that task. And it will have a ripple effect across the global economy. Now we need governments to help get the job done, by setting the ambitious policies that can unlock, accelerate and help direct the investment to where it’s needed most.

Rishi Sunak, Chancellor of the Exchequer said:

I’m so proud that under the UK’s leadership, the number of financial firms committed to Net Zero plans has tripled, with the assets now covered totalling $130 trillion. Harnessing the trillions of dollars controlled by these companies in the fight against climate change is crucial. So I’ve announced new requirements for firms to publish their net zero transition plans. Together we can provide the cash the world needs to stop catastrophic climate change.

Michael R. Bloomberg, Co-Chair of the Glasgow Financial Alliance for Net Zero said:

Winning the battle against climate change will require vast amounts of new investment and the majority will have to come from the private sector. Leaders in finance have strong incentives to act, and under Mark Carney and Nigel Topping’s leadership, GFANZ has grown to include some of the largest financial institutions in the world. We look forward to building on this progress in the next phase of the alliance’s work, by creating the tools and industry wide coordination we need to turn commitments into action and speed up the transition to a net-zero global economy.

Klaas Knot, Vice Chair of the Financial Stability Board, said:

An orderly transition of the financial sector to meeting net zero commitments supports financial stability. So, we look forward to regular updates to the FSB on the progress of GFANZ, as part of the FSB’s broader outreach in taking forward its roadmap to address financial risks from climate change.

1 The Glasgow Financial Alliance for Net Zero (GFANZ) is a global coalition of leading financial institutions in the UN’s Race to Zero that is committed to accelerating and mainstreaming the decarbonisation of the world economy and reaching net zero emissions by 2050. It provides a practitioner-led forum for financial firms to collaborate on substantive, crosscutting issues that will accelerate the alignment of financing activities with net zero and support efforts by all companies, organisations, and countries to achieve the goals of the 2015 Paris Agreement. To ensure credibility and consistency, access to GFANZ is grounded in the UN’s Race to Zero campaign, and entry requirements are tailored to the activities of the diverse firms represented. Further details can be found on https://www.gfanzero.com. Note that each entity in GFANZ has made its own net zero commitment with potential overlap across initiatives, institutions and assets across GFANZ and its sub-sector alliances.

2 Analysis undertaken by Vivid Economics. More detail found here: https://www.gfanzero.com/netzerofinancing

3 The full report The Glasgow Financial Alliance for Net Zero: Our progress and plan towards a net-zero global economy can be found here: https://assets.bbhub.io/company/sites/63/2021/11/GFANZ-Progress-Report.pdf

4 The Call to Action can be found here: https://assets.bbhub.io/company/sites/63/2021/10/GFANZ-call-to-action.pdf.

5All members of the UN-convened Net Zero Asset Owner Alliance or the UN-convened Net Zero Asset Manager Alliance. Source: https://www.unepfi.org/news/industries/investment/net-zero-asset-owner-alliance-members-to-cut-portfolio emissions-25-30-by-2025/ and https://www.netzeroassetmanagers.org/net-zero-asset-managers-initiative-signatories disclose-interim-targets-with-over-a-third-of-assets-managed-in-line-with-net-zero

6 Full details can be found in the Notes to Editors.

7 More details can be found here: https://www.gfanzero.com/

8 For list of the initial initiatives, see Notes to Editors.

Notes for editors:

The Glasgow Financial Alliance for Net Zero (GFANZ) is a global coalition of leading financial institutions in the UN’s Race to Zero that is committed to accelerating and mainstreaming the decarbonisation of the world economy and reaching net-zero emissions by 2050. It provides a practitioner-led forum for financial firms to collaborate on substantive, crosscutting issues that will accelerate the alignment of financing activities with net zero and support efforts by all companies, organisations, and countries to achieve the goals of the 2015 Paris Agreement. To ensure credibility and consistency, access to GFANZ is grounded in the UN’s Race to Zero campaign, and entry requirements are tailored to the activities of the diverse firms represented. Further details can be found on gfanzero.com.

Race to Zero

Race to Zero is the UN-backed global campaign rallying non-state actors – including companies, cities, regions, financial and educational institutions – to take rigorous and immediate action to halve global emissions by 2030 and deliver a healthier, fairer zero carbon world in time. All actors must meet stringent criteria which will bring them to the starting line to credibly race to zero emissions. The Race to Zero campaign has an independent, academic-led Expert Peer Review Group (EPRG) tasked with reviewing applications to join the Race to Zero and ensuring they meet the ambitious criteria for participation.

This means all GFANZ members must align with the Race to Zero criteria, which are (1) use science-based guidelines to reach net-zero emissions across all emissions scopes by 2050, (2) set 2030 interim targets that represent a fair share of the 50% decarbonisation required by the end of the decade, (3), set and publish a net-zero transition strategy, (4) commit to transparent reporting and accounting on progress against those targets, and (5) adhere to strict restrictions on use of offsets. Further details can be found on racetozero.unfccc.int/.

The Alliance members of GFANZ, summary of commitments

Membership of GFANZ is through one of the member Alliances.

 • The Net Zero Asset Managers initiative (NZAM), launched in December 2020, is an international group of asset managers committed to supporting the goal of net-zero GHG emissions by 2050 or sooner, in line with global efforts to limit warming to 1.5 degrees C and investing aligned with the same goal. In delivering net-zero alignment, the asset managers commit to prioritising real-economy emissions reductions, take account of material portfolio Scope 3 emissions, create investment products aligned with net zero emissions, and facilitate increased investment in climate solutions. In addition, to ensure investors are driving broader change, NZAM is putting in place a stewardship and engagement strategy consistent with net-zero emissions by 2050 and ensuring all policy advocacy supports the same objective. Signatories also commit to transparent and rigorous accountability. They will publish TCFD reporting annually, including a climate action plan, and submit reports through the PRI19 and/or CDP20 platforms.

• The Net-Zero Asset Owner Alliance (NZAOA), launched in September 2019, is the first net zero finance sector initiative to have joined the Race to Zero. It shows united asset owner action to align portfolios with a 1.5 degrees C scenario, taking into account best available scientific knowledge, including the findings of the IPCC based on low or no overshoot scenarios. NZAOA places great emphasis on ambitious, intermediary, quantitative targets being set every five years, starting with a first generation of such targets being published now for attainment by 2025, based on the Alliance’s own and comprehensive 2025 Target- Setting Protocol, which underwent a public consultation and is revised on a yearly basis. NZAOA members aligned on an Alliance-wide Position on Thermal Coal, stating a phaseout of most thermal coal assets by 2030 for industrialised countries and a full phaseout globally by 2040.

• The Net-Zero Banking Alliance (NZBA), launched in April 2021, is the banking element of GFANZ and Race to Zero. Signatories are committed to aligning their lending and investment portfolios with net-zero emissions by 2050, as well as with a temperature outcome of no more than 1.5 degrees C by 2100, based on low or no-overshoot scenarios and considering best available scientific knowledge. Combining near-term action with accountability, this ambitious commitment sees banks setting intermediate targets for 2030 or sooner, using robust, science-based guidelines.

• The Net-Zero Insurance Alliance (NZIA), launched in July 2021, brings together the world’s leading insurers, reinsurers and insurance marketplaces to play their part in accelerating the transition to net-zero emission economies. Signatories are committed to individually transitioning their underwriting portfolios to net-zero greenhouse gas emissions by 2050, as well as with a temperature outcome of no more than 1.5 degrees C by 2100, taking into account the best available scientific knowledge, including the findings of the IPCC based on low or no-overshoot scenarios.

• The Net Zero Investment Consultants Initiative (NZICI), launched in September 2021, brings together leading investment consultants, to support the goal of reaching global net-zero GHG emissions by 2050 or sooner. First among these actions is integrating advice on net- zero alignment into investment consulting services as soon as possible and within two years of making this commitment and supporting efforts to decarbonise the global economy by helping their clients to prioritise real-economy emissions reductions.

• The Net Zero Financial Service Providers Alliance (NZFSPA), launched in September 2021, brings together 22 leading organisations, including the world’s largest credit rating agencies, audit networks, leading index providers, global stock exchanges, data providers, and providers of advisory services, who will all be critical to unlocking a net zero financial system. As members of the NZFSPA, these organisations have committed to aligning all relevant services and products to net zero by 2050. Members will set science-based targets for their emissions, including interim targets for 2030, and report on their progress against those targets annually, including disclosures using existing frameworks such as those the TCFD recommendations.

• The Paris Aligned Investment Initiative (PAII), established in May 2019, is an investor led global forum enabling investors to align their portfolios and activities to the goals of the Paris Agreement. Through the Paris Aligned Asset Owners net-zero commitment, signatories commit to a comprehensive range of actions toward net zero including (1) transitioning investments to achieve net-zero portfolio GHG emissions by 2050 or sooner, with the aim of achieving emissions reductions in the real economy, (2) setting interim targets by 2030 or sooner for decarbonising portfolios and investing in climate solutions, consistent with the 50% reduction in global emissions set in the IPCC special report on global warming of 1.5 degrees C, and (3) implementing a stewardship and voting strategy consistent with achieving net zero.

The 24 initiatives were set out in the COP26 Private Finance Strategy in November 2020. They cover a range of areas:

• Reporting: improving the quantity, quality and comparability of climate-related disclosures by implementing a common framework built on the Taskforce for Climate-related Financial Disclosures (TCFD) recommendations.

• Risk management: ensuring that the financial sector can measure and manage climate-related financial risks.

• Returns: helping investors identify the opportunities in the transition to net zero and report how their own portfolios are aligned for the transition.

• Mobilisation: increasing private financial flows to emerging and developing economies, by connecting available capital with investable projects and encouraging new market structures.

Further detail can be found here: https://ukcop26.org/wpcontent/uploads/2020/11/COP26-Private-Finance-Hub-Strategy_Nov-2020v4.1.pdf

IFRS Foundation: The International Financial Reporting Standards (IFRS) Foundation is a public interest organisations established in 2001 to develop a single set of high-quality, understandable, enforceable and globally accepted accounting IFRS Standards. IFRS Standards are currently required in more than 140 jurisdictions. Since the start of 2021 the IFRS Foundation Trustees have been working towards the creation of a new standard setting board within the IFRS Foundation to develop comprehensive global baseline sustainability reporting standards to meet the needs of the capital markets. For more information, see: https://www.ifrs.org/

Network for Greening the Financial System: The Network for Greening the Financial System (NGFS) is a group of central banks and supervisors that exchange experiences, share best practices, contribute to the development of environment and climate risk management in the financial sector, and mobilize mainstream finance to support the transition toward a sustainable economy. Established at the Paris “One Planet Summit” in December 2017, membership has grown from eight founding members to 100 members and 15 observers, representing countries responsible for 85% of global emissions and spread across the five continents. Its purpose is to define and promote best practices to be implemented within and outside of the Membership of the NGFS and to conduct or commission analytical work on green finance. So far, it has published guidance and best practice covering a range of central bank and supervisor responses to climate risks, including supervision, scenario analysis exercises, sustainable investment practices, and monetary policy implementation. For more information, see: https://www.ngfs.net/en

Country platforms: A country platform is a mechanism that convenes and aligns stakeholders – including national and international governments, businesses, NGOs, civil society organisations (CSOs), donors and other development actors—around a specific issue or geography to agree and coordinate priorities. Country platforms were highlighted in the G20 Eminent Persons Report, which outlined some of the principals of country platforms.

List of five catalytic initiatives

• Climate Finance Leadership Initiative (CFLI) Country Pilots; GFANZ will work to support CFLI’s Country Pilot in India and other countries as they emerge. CFLI India is an early example of a country platform initiative involving governments, major private-sector Indian and multinational corporations and financial institutions.

• FAST-Infra; establishing a consistent, globally applicable labelling system for sustainable infrastructure assets, so investors can have confidence in them and support projects that will generate long-term, stable returns. Developed as a public private partnership led by HSBC, Macquarie, and the Global Infrastructure Facility.

• The Global Energy Alliance for People and Planet; delivering transformational programs to accelerate and scale an equitable energy transition in developing and emerging economies through fossil fuel transitioning, grid-based renewables, and distributed renewables. Backed by an initial $10 billion commitment from preeminent philanthropic, government, donor, multilateral development bank, development finance institution, and private sector partners, the alliance will reach 1 billion people with reliable, renewable energy, creating tens of millions of green jobs and avoiding 4 billion tons of greenhouse gas emissions.

• Innovative Finance for the Amazon, Cerrado and Chaco (IFACC); scaling innovative financial mechanisms—including farm loan products, farmland investment funds, corporate debt instruments and capital markets offerings— and helping farmers implement proven business models to decouple beef and soy production models from deforestation and conversion of natural habitats. Key partners include United Nations Environment Programme; the Nature Conservancy; the World Economic Forum and the Tropical Forest Alliance, an initiative hosted by the World Economic Forum.

• MOBILIST; designed to catalyse innovative, scalable and replicable investment products on major and local exchanges across the world, delivering on the Global Goals and supporting the net-zero transition for developing countries. For asset owners, MOBILIST offers a platform to develop the products that public market investors want, and to enable climate financing to respond to the scale of the opportunity and needs in that transition. MOBILIST is a Foreign, Commonwealth & Development Office flagship programme backed by capital, technical expertise and HMG’s global network.

COP26 Logo 'UN Climate Change Conference UK 2021 In partnership with Italy'

03.11.2021

CHAIRS JOINT COP26 STATEMENT: COALITION OF FINANCE MINISTERS FOR CLIMATE ACTION AND NETWORK OF CENTRAL BANKS AND SUPERVISORS FOR GREENING THE FINANCIAL SYSTEM

On the occasion of the 26th Conference of the Parties to the United Nations Framework Convention on Climate Change (COP26), we, the Co-Chairs of the Coalition of Finance Ministers for Climate Action (the Coalition) and the Chair of the Network of Central Banks and Supervisors for Greening the Financial System (NGFS), reaffirm our commitment to mobilising our organisations to achieve the goals of the Paris Agreement.

Our two entities recognised from the start that achieving the goals of the Paris Agreement requires ambitious climate actions from all Parties; and, from the public sector, stepped-up climate engagements and broader alignment of economic policies. Against this background, finance ministries, central banks and financial supervisors need to take action within their respective fields of responsibility to implement appropriate economic policies and promote financial flows “consistent with a pathway towards low greenhouse gas emissions and climate-resilient development” as set out in the Paris Agreement.

To that end, we have fostered close dialogue and collaborative action, at both national and international levels, between finance ministries and the community of central banks and supervisors. Joint events and workshops have enabled members from both organizations to discuss, learn, and identify areas for collaboration. Over the past few years, we have pushed the idea of building back better—in the context of a robust post-Covid green recovery—by calling for the incorporation of climate considerations in recovery plans. We have also identified the importance of training and capacity building among our members and look forward to cooperating in these areas.

We recognise the potential to work together more closely on key priority areas, including the assessment and analysis of the economic and financial impacts of climate change (such as forward-looking scenario analyses and prudential stress tests), as well as the implications for the conduct of economic policy and the preservation of financial stability. We believe that a transition consistent with the Paris Agreement goal of limiting average global warming to 1.5°C is within our collective reach, provided we take strong action without delay and implement well-designed policies that will together create the incentives needed to enable an orderly transition.

Given the urgency to achieve net-zero and climate-resilient economies, we will work within our respective fields of responsibility to help ensure the readiness and resiliency of the financial sector and drive change in the real sector. Action by central banks, supervisors, finance ministries, as well as line ministries can play a key role in mitigating climate-related financial risks. We recognise the importance of private capital mobilisation. Success hinges on our collective ability to address climate change in a comprehensive manner through ambitious mitigation efforts, investments in adaptation and resilience, and policy measures that ensure a just, inclusive, and equitable transition.

We acknowledge that beyond the potentially significant economic and financial implications directly associated with nature loss, global climate and nature goals are closely intertwined and the loss of biodiversity and ecosystem services could undermine climate change mitigation and adaptation efforts while exacerbating climate risks. Addressing these issues will be critical for a successful transition to net zero. Conserving and restoring forests and other critical ecosystems, as well as transitioning to more sustainable agricultural and land-use practices, can help substantially reduce greenhouse gas emissions and increase sequestering of atmospheric carbon. Against this backdrop, we will strive to better reflect cross-cutting issues related to agriculture, forests, and other land uses in our work.

Finally, we recognise that our strength is rooted in our diverse and committed membership. We proudly chair global organisations comprised of low-, middle-, and high-income countries that all resolve to urgently scale-up efforts to ensure a smooth transition toward a net-zero, climate-resilient, and nature-positive economy. We will continue to work closely together to raise ambition and accelerate action.

COP26 Logo 'UN Climate Change Conference UK 2021 In partnership with Italy'

03.11.2021

MDB Joint Climate Statement

Climate change, and the parallel crisis of environmental degradation, are critical factors affecting the development prospects of countries, businesses, and households, and threatening to reverse years of development progress. Multilateral Development Banks (MDBs) have proven to be essential partners in global efforts to manage the urgent transitions climate change will involve, through the financial, technical, and knowledge support we provide, tailored to our clients’ unique domestic and international circumstances.

To set the world on a sustainable development path requires a significant expansion and acceleration of climate action across countries and economic sectors, taking into account the findings of the Sixth Assessment Report (AR6) of the Intergovernmental Panel on Climate Change (IPCC) released in August 2021.

We welcome the growing ambition reflected in the new Nationally Determined Contributions (NDCs) and we will continue to support the delivery of these plans in developing countries, building on our track records of supporting low-carbon, climate-resilient, and nature-based solutions for sustainable development. We will also contribute more broadly through our joint and individual efforts to align our financing flows with the Paris Agreement and in our work supporting our clients to develop ambitious Long Term Strategies (LTSs).

MDBs are delivering

  • Since the Paris Agreement was signed in 2015, MDBs have significantly scaled up their activity to address the climate crisis.
  • Total MDB climate finance reached US$66 billion in 2020, of which US$38 billion was for low- and middle-income countries.
  • Since 2011, total MDB support for climate action in low- and middle-income countries has totalled over US$300 billion, and in 2019 MDBs provided 46% of public climate finance.
  • MDB adaptation finance to low- and middle-income countries increased to US$13 billion in 2020 from US$5 billion in 2015, with the adaptation share rising from 20% to 35% over this period.
  • Since 2015, MDBs have mobilised over US$100 billion in climate co-finance from the private sector. Climate co-finance for low- and middle-income countries from public and private sources reached US$36 billion in 2020.
  • In 2017, MDBs committed to align their financial flows with the goals of the Paris Agreement, and at COP24 they published their joint approach, to put that commitment into action. Since then, MDBs have outlined a framework to assess the alignment of their investment projects with the goals of the Paris Agreement, and as of COP26, most have announced target dates for their Paris alignment commitments.
  • MDBs are actively supporting their client countries in developing their NDCs, and integrating climate factors in the formulation of country and sector development plans.

MDBs raising climate ambition for COP26 and beyond

Reflecting our individual mandates, approaches and capabilities:

  • MDBs are increasing climate finance, including the amount of finance available to support adaptation initiatives.
  • MDBs will aim to increase the level of private capital mobilised in support of mitigation and adaptation investments, using platforms, investment vehicles, and blended finance instruments, that are fit for purpose.
  • MDBs will promote natural capital, biodiversity, and nature-based solutions, as well as gendersmart solutions, which support client climate and environmental goals.
  • MDBs will support Just Transitions in communities, regions, and sectors directly impacted by the low-carbon energy, transport and industrial transitions.
  • In addition, MDBs are working to develop dedicated approaches to assess the Paris Alignment of policy-based lending, real sector operations and lending through financial intermediaries, and will soon begin to test these parts of the MDBs Paris alignment frameworks.
  • MDBs are also working and collaborating to enhance support to countries for the formulation of robust and ambitious NDCs, LTSs, and National Adaptation Plans (NAPs) in line with the Paris Agreement goals. This includes enhancing synergies between these instruments and ensuring they are mainstreamed into national development plans. MDBs are working together to increase the level of funding and coordination of their support at national, sub-national and sector level to facilitate the development and implementation of LTSs, including by exploring the potential establishment of a joint MDB LTS Facility.
  • MDBs are working with clients to develop plans to integrate the transition to a net-zero emissions and climate-resilient economy with development programs in key sectors such as energy, cities, food and land use, water, and industry.
  • MDBs are prioritising the development of cost-effective and equitable approaches to decommissioning coal and other high-GHG emission systems, taking into account socioeconomic trade-offs.
  • MDBs are working to accelerate climate finance for cities, reflecting their key role in developing and implementing climate action at the local level.
  • MDBs are supporting their client countries to design, pilot and implement carbon pricing instruments, including carbon taxes and fossil fuel subsidy reduction.

Coordination

The effective implementation of MDB climate action and Paris alignment relies first and foremost on the quality and depth of engagement with countries of operations and clients. The necessary acceleration in MDB climate action to address the climate and environmental emergencies, also depend on broad shareholder and donor support, in terms of strategy and resources. In implementing their climate strategies, MDBs will pursue an active coordination and partnership approach with organisations and coalitions, working to achieve the goals of the Paris Agreement.

African Development Bank
Asian Development Bank
Asian Infrastructure Investment Bank
Council of Europe Development Bank
European Bank for Reconstruction and Development
European Investment Bank
Inter American Development Bank Group
Islamic Development Bank
New Development Bank
World Bank Group

COP26 Logo 'UN Climate Change Conference UK 2021 In partnership with Italy'

03.11.2021

UK welcomes work to develop global sustainability reporting standards alongside 40 international partners

UK government joins 40 international partners from 6 continents to welcome the establishment of the IFRS Foundation’s new International Sustainability Standards Board (ISSB) at COP26.

Leaders committed to review progress annually, starting in 2022, supported by a report led by the IEA, working with IRENA and the UN High Level Action The IFRS Foundation has announced the establishment of an International Sustainability Standards Board (ISSB) to develop comprehensive global baseline sustainability reporting standards under robust governance and public oversight. The IFRS Foundation confirmed consolidation of two sustainability reporting organisations, the Value Reporting Foundation and the Climate Disclosure Standards Board, to create a global standard-setter for sustainability disclosures for the capital markets.

The Foundation also published two prototype standards to enable the ISSB to rapidly build on existing frameworks, including the Task Force on Climate-Related Financial Disclosures (TCFD), when developing its standards. Standards will be subject to full public consultation and can be considered for adoption by jurisdictions on a voluntary basis. Jurisdictions will have their own legal frameworks for adopting, applying or otherwise making use of international standards.

Finance Ministers and Central Bank Governors from 40 jurisdictions (see below) from 6 continents joined the UK in publicly welcoming the announcement of the establishment of the ISSB and its work programme to develop a set of internationally consistent, high-quality, and reliable baseline standards for disclosure of sustainability-related information on enterprise value creation.

List of Finance Ministers

Australia
Brazil (Central Bank Governor)
Canada
Chile
China
Costa Rica
Egypt
Ethiopia
European Commission
Fiji
France
Germany
Greece
Guatemala
India
Indonesia
Italy
Jamaica
Japan
Kenya
South Korea
Luxembourg
Maldives
Mexico
Morocco
Netherlands
New Zealand
Nigeria
Paraguay
Philippines
Russia
Saudi Arabia
Seychelles
Singapore
Spain
Switzerland
Tonga
Turkey
UK
Uruguay
USA

COP26 Logo 'UN Climate Change Conference UK 2021 In partnership with Italy'

02.11.2021

Green Grids Initiative – One Sun One World One Grid: One Sun Declaration

The untapped potential of the sun is well known – all the energy humanity uses in a year is equal to the energy that reaches the earth from the sun in a single hour. The sun never sets – every hour, half the planet is bathed in sunshine. By trading energy from sun, wind and water across borders, we can deliver more than enough clean energy to meet the needs of everyone on earth. This trading is already beginning to happen through discrete bilateral and regional arrangements. But to meet the sheer scale of the challenge, these efforts need to be brought together and supplemented to create a more inter-connected global grid. We call this vision: One Sun One World One Grid.

We need new transmission lines crossing frontiers and connecting different time zones, creating a global ecosystem of interconnected renewables that are shared for mutual benefit and global sustainability. This must be combined with expanded and modernised national and regional grids and complemented with the rapid scale-up of mini-grids and off-grid solar solutions.

To help deliver the vision of One Sun One World One Grid, we have resolved to combine our efforts and create a more inter-connected global grid. Our next step is to develop an action agenda for global cooperation on this agenda. Through working groups of interested governments, regulators, financiers, institutions, companies, legislators and researchers, we will seek to provide a common global framework for efforts on:

  1. Investing in solar, wind, storage and other renewable energy generation in locations endowed with renewable resources for supporting a global grid.
  2. Building long-distance cross-border transmission lines to connect renewable energy generators and demand centres across continents, underpinned by effective and mutually beneficial cross-border power trading arrangements.
  3. Developing and deploying cutting edge techniques and technologies to modernise power systems and support green grids which can integrate billions of rooftop solar panels, wind turbines and storage systems.
  4. Supporting the global transition to zero emission vehicles through incorporating the role of electric vehicles to help improve grid flexibility.
  5. Attracting investment into solar mini-grids and off-grid systems to help vulnerable communities gain access to clean, affordable, and reliable energy without grid-access in their own areas, enhancing socio-economic development and a resilient power supply for all.
  6. Developing innovative financial instruments, market structures, and facilitate financial and technical assistance to attract low-cost capital, including climate finance, for global solar grid infrastructure.

Through these and other efforts, we intend to cooperate internationally to share ideas and learn from each other’s successes and expertise. In this common endeavour, we can ensure that the sun becomes a secure and reliable source of energy for all, especially for the world’s underprivileged citizens.

Realizing One Sun One World One Grid through interconnected green grids can be transformational, enabling all of us to meet the targets of the Paris Agreement to prevent dangerous climate change, to accelerate the clean energy transition, and to achieve the Sustainable Development Goals. These efforts can stimulate green investments and create millions of good jobs. By sharing the sun’s energy, we can help to build a more peaceful and prosperous world.

Members of the Green Grids Initiative – One Sun One World One Grid Steering Committee:

Australia

France

India

United States of America

United Kingdom

Endorsed by:

Albania

Algeria

Argentina Republic

Azerbaijan

Bangladesh

Barbados

Belize

Belgium

Benin

Botswana

Burkina Faso

Burundi

Cambodia

Cameroon

Chad

Comoros

Cote d’Ivoire

Cuba

Democratic Republic of Congo

Denmark

Djibouti

Dominica

Egypt

El Salvador

Equatorial Guinea

Ethiopia

Fiji

Gabonese Republic

Gambia

Germany

Ghana

Grenada

Guinea

Guyana

Haiti

Holy See

Ireland

Italy

Jamaica

Jordan

Kiribati

Madagascar

Malawi

Maldives

Mali

Marshall Islands

Mauritius

Mongolia

Morocco

Mozambique

Myanmar

Namibia

Nauru

Nepal

Netherlands

Nicaragua

Niger

Nigeria

Oman

Papua New Guinea

Peru

Rwanda

Saint Vincent and the Grenadines

Samoa

Sao Tome and Principe

Saudi Arabia

Senegal

Seychelles

Somalia

South Sudan

Sri Lanka

St. Lucia

Sudan

Suriname

Sweden

Tanzania

Togolese Republic

Tonga

Trinidad and Tobago

Tuvalu

Uganda

Ukraine

United Arab Emirates

Vanuatu

Venezuela

Zambia

Zimbabwe

Updated 10 December 2021

COP26 Logo 'UN Climate Change Conference UK 2021 In partnership with Italy'

02.11.2021

Political Declaration on the Just Energy Transition in South Africa

Declaration from the Governments of the Republic of South Africa, the United Kingdom of Great Britain and Northern Ireland, the United States of America, the Republic of France and the Federal Republic of Germany, and the European Union.

  1. Recognising the need for accelerated actions towards the goals and objectives  of the United Nations Framework Convention on Climate Change and Paris Agreement, including the long-term goals on mitigation, adaptation and finance, to avoid the worst impacts of climate change on our countries, our people and the environment;
  2. Noting that in order to limit the impacts of climate change, the international community needs to collectively halve global greenhouse gas emissions by 2030 and achieve global net zero CO2 emissions by 2050, while strongly reducing other greenhouse gas emissions;
  3. Underlining the consequent urgency of decarbonising energy systems by increasing energy efficiency, and by accelerating the retirement of coal power and the deployment of renewables;
  4. Acknowledging that sustainable financing from developed countries, multilateral institutions and investors is required to enhance support for South Africa’s transition; 
  5. Emphasising the necessity of a just, equitable and inclusive transition for workers and affected communities so that all are protected against the risks and benefit from the opportunities presented by this transition, and no one is left behind;
  6. Confirming that the process of transition needs to be based on the full involvement of organised labour and business in targeted programmes of reskilling and upskilling, creating employment and providing other forms of support to ensure that workers are the major beneficiaries of our transition to a greener future;
  7. Acknowledging that South Africa faces significant development challenges, including poverty, inequality and unemployment, which have been exacerbated by the impacts of the COVID-19 pandemic;
  8. Recognising that South Africa requires a transition that is just, especially as there are several important sectors of its economy that may otherwise be negatively affected by such a transition, including mining, energy, manufacturing and transport; 
  9. Welcoming, in this context, South Africa’s submission of an enhanced, ambitious Nationally Determined Contribution that strengthens the country’s contribution to the adaptation and mitigation goals of the Paris Agreement;
  10. Recognising the progress made by the Government of the Republic of South Africa – as well as leadership from Eskom, organised labour, businesses, civil society, and local governments – towards the net zero aspirations set out in South Africa’s Long-Term Low Emissions Development Strategy;
  11. Noting South Africa’s intention to decommission and repurpose or repower coal-fired power stations, invest in new low-emission generation capacity such as renewables, increase energy efficiency and pursue green industrialisation such as manufacturing using green technology and a shift to the production of electric vehicles; 
  12. Embracing the opportunities for industrial innovation to create quality green jobs, increase renewable energy generation and drive sustainable economic growth for a resilient and net zero South African economy; 
  13. Recognising the unprecedented opportunity for South Africa to become a leader in the just energy transition, and the importance of global collaboration; 
  14. Recognising also the need for long term cooperation, commensurate with the timeline for South Africa’s just energy transition; and
  15. Acknowledging the commitments of developed countries to provide support, including finance, to developing countries’ mitigation and adaptation efforts;

Resolve to

  1. Establish an ambitious long-term partnership to support South Africa’s pathway to low emissions and climate resilient development, to accelerate the just transition and the decarbonisation of the electricity system, and to develop new economic opportunities such as green hydrogen and electric vehicles amongst other interventions to support South Africa’s shift towards a low carbon future.
  2. Establish an inclusive task force comprised of South Africa and international partners, to enable:
    1. The accelerated decarbonisation of South Africa’s electricity system to achieve the most ambitious target possible within South Africa’s Nationally Determined Contribution range to the extent of available resources;
    2. South Africa’s efforts to lead a just transition that protects vulnerable workers and communities, especially coal miners, women and youth, affected by the move away from coal; 
    3. South Africa’s nationally determined efforts to successfully and sustainably manage Eskom’s debt, define the role of the private sector, and create an enabling environment through policy reform in the electricity sector, such as unbundling and improved revenue collection;
    4. Local value chains (including Micro, Small and Medium Enterprises) to benefit from new areas of economic opportunity; and
    5. Opportunities for technological innovation and private investment to drive the creation of green and quality jobs as part of a prosperous low emission economy.
  3. Subject to concurrence on the investment framework, and in line with budgetary procedures and consensus on the use of funds and terms on which finance may be provided, mobilise an initial amount of approximately $8.5 billion over the next three to five years through a combination of appropriate financial instruments, which may include but is not limited to multilateral and bilateral grants, concessional loans, guarantees and private investments, and technical support to enable the just transition, with a view to longer term engagement. 
  4. Explore additional sources of financing and mobilise or include additional international partners, to further support South Africa’s ambition.
  5. This partnership is a demonstration of the willingness of both developed and developing countries to cooperate on a vital challenge facing humanity. 
COP26 Logo 'UN Climate Change Conference UK 2021 In partnership with Italy'

02.11.2021

COP26 World Leaders Summit- Statement on the Breakthrough Agenda

Today, at COP26 in Glasgow, the countries listed below launched the Breakthrough Agenda – a commitment to work together internationally this decade to accelerate the development and deployment of the clean technologies and sustainable solutions needed to meet our Paris Agreement goals, ensuring they are affordable and accessible for all. 

The 2020s must be a decade of delivery across all major emitting sectors. While we acknowledge our different national circumstances, we will endeavour to work together in each sector, including through public-private collaboration and by mobilising finance at scale, to make the global transition to a clean economy faster, lower cost and easier for all, while making solutions to adaptation more affordable and inclusive. 

This is essential to meeting the Paris Agreement goals, including holding the increase in the global average temperature to well below 2°C and pursuing efforts to limit it to 1.5°C, noting that the science shows further acceleration of efforts is needed if we are to collectively keep 1.5°C within reach, which will prevent the worst effects of climate change, especially for the most vulnerable countries.

The benefits of this Agenda go beyond tackling climate change alone. Our ambition is to catalyse the growth of markets, jobs and economic development globally for clean technologies and sustainable solutions, support the achievement of the UN Sustainable Development Goals, strengthen the climate resilience of our societies and realise multiple cobenefits such as cleaner air, water and better health.  

As a first step under this Agenda, we are launching the Glasgow Breakthroughs – global goals that aim to make clean technologies and sustainable solutions the most affordable, accessible and attractive option in each emitting sector globally before 2030.

We intend to discuss this Agenda in the future at relevant leader level events and consider how it could further support global efforts to meet the goals of the Paris Agreement. To support this intention, starting in 2022, we invite responsible Ministers to review global progress, including at Mission Innovation and Clean Energy Ministerial meetings, informed by an annual report, led by the International Energy Agency, working in collaboration with IRENA, the United Nations High Level Climate Action Champions, and other institutions, bodies and industry leaders as appropriate. 

We invite all other States to join the Breakthrough Agenda.

Endorsed by:

  • Australia
  • Azerbaijan
  • Belgium
  • Canada
  • Cabo Verde
  • Chile
  • China
  • Denmark
  • Egypt
  • European Union
  • Finland
  • France
  • Germany
  • Guinea Bissau
  • Holy See
  • India
  • Ireland
  • Israel
  • Italy
  • Japan
  • Kenya
  • Latvia
  • Lithuania
  • Luxembourg
  • Malta
  • Mauritania
  • Morocco
  • Namibia
  • Netherlands
  • New Zealand
  • Nigeria
  • North Macedonia
  • Norway
  • Panama
  • Portugal
  • Republic of Korea
  • Senegal
  • Serbia
  • Slovakia
  • Spain
  • Sweden
  • Turkey
  • United Arab Emirates
  • United Kingdom
  • United States of America

The Glasgow breakthroughs

Power

Breakthrough: Clean power is the most affordable and reliable option for all countries to meet their power needs efficiently by 2030.  

Global metrics:  We invite the IEA, working in collaboration with IRENA and the United Nations High Level Climate Action Champions, and other institutions, bodies and industry leaders, to lead an assessment of global progress towards this breakthrough, including reporting on evidence of the following:

  1. Annual capacity additions of clean energy (on grid and distributed), including as a share of global total electricity generation.
  2. Investments in both the research, development and demonstration and deployment of clean power, enabling technology, and grids, including as a share of total power investment globally.
  3. Evidence that power systems can integrate very high levels of variable renewable energy (including up to 100%) in different geographies and climates whilst maintaining a cost-efficient, secure and resilient system.  
  4. Rate of annual energy efficiency improvement (including for key products sold globally).
  5. Relative cost, affordability and accessibility of clean power technologies (compared to alternatives). 

Leading initiatives for international collaboration: As well as working through relevant international institutions and region-specific initiatives, we note the importance of the following global initiatives to making progress towards and coordinating activities towards this breakthrough goal:

  • Breakthrough Energy Catalyst
  • C40 Cities’ Clean Energy Network
  • Clean Energy Ministerial’s Super-Efficient Equipment and Appliance Deployment (SEAD) initiative
  • Climate Group’s EP100
  • RE100, led by Climate Group in partnership with CDP 
  • Efficiency for Access Coalition
  • Energy Transition Council 
  • First Movers Coalition
  • Global Covenant of Mayors for Climate & Energy (proposed- subject to agreement of countries)
  • Global Energy Alliance for People and Planet
  • Global Power System Transformation Consortium 
  • Green Grids initiative – One Sun, One World, One Grid 
  • International Smart Grid Action Network 
  • Mission Innovation Green Powered Future Mission
  • Sustainable Energy for All (SEforALL) (proposed- subject to agreement of countries)

We invite all relevant international initiatives to align with this breakthrough.

Participants:

  • Australia
  • Azerbaijan
  • Belgium
  • Canada
  • Chile
  • Denmark
  • Egypt
  • European Union
  • Finland
  • France
  • Germany
  • Guinea Bissau
  • Holy See
  • India
  • Ireland
  • Israel
  • Italy
  • Japan
  • Kenya
  • Lithuania
  • Morocco
  • Namibia
  • Netherlands
  • New Zealand
  • Nigeria
  • North Macedonia
  • Norway
  • Panama
  • Portugal
  • Republic of Korea
  • Serbia
  • Slovakia
  • Spain
  • Sweden
  • United Kingdom
  • United States of America

Road transport

Breakthrough: Zero emission vehicles are the new normal and accessible, affordable, and sustainable in all regions by 2030.

Global metrics:  We invite the IEA, working in collaboration with IRENA and the United Nations High Level Climate Action Champions, and other institutions, bodies and industry leaders, to lead an assessment of global progress towards this breakthrough, including reporting on evidence of the following:

  1. Share of new light- and heavy-duty vehicle sales that are zero emission.
  2. Amount of available recharging infrastructure for zero emission vehicles. 
  3. Investments in both the research, development and demonstration and the deployment of zero emission vehicles and of key components such as batteries.
  4. Relative cost, affordability and accessibility of zero emission vehicles and of key components such as batteries (compared to alternatives). 

Leading initiatives for international collaboration: As well as working through relevant international institutions and region-specific initiatives, we note the importance of the following global initiatives to making progress towards and coordinating activities towards this breakthrough goal:

  • Clean Energy Ministerial’s Electric Vehicle Initiative
  • Climate Group’s EV100 and Route Zero
  • First Movers Coalition
  • Transport Decarbonisation Alliance
  • Zero Emission Vehicle Transition Council

We invite all relevant international initiatives to align with this breakthrough.

Participants:

  • Australia
  • Azerbaijan
  • Belgium
  • Canada
  • Denmark
  • Egypt
  • European Union
  • Finland
  • France
  • Germany
  • Guinea Bissau
  • Holy See
  • India
  • Ireland
  • Israel
  • Japan
  • Latvia
  • Lithuania
  • Luxembourg
  • Malta
  • Morocco
  • Namibia
  • Netherlands
  • New Zealand
  • Norway
  • Panama
  • Portugal
  • Republic of Korea
  • Serbia
  • Sweden
  • Turkey
  • United Kingdom
  • United States of America

Steel

Breakthrough: Near-zero emission steel is the preferred choice in global markets, with efficient use and near-zero emission steel production established and growing in every region by 2030.

Global metrics: We invite the IEA, working in collaboration with IRENA and the United Nations High Level Climate Action Champions, and other institutions, bodies and industry leaders, to lead an assessment of global progress towards this breakthrough, including reporting on evidence of the following:

  1. Number of near-zero emission steel plants in operation and under development, and total global near-zero emission steel production capacity.
  2. Share of global steel production covered by near zero emission steel standards.
  3. Investments in both the research, development and demonstration and deployment of near zero emissions steel technologies.
  4. Relative cost, affordability and accessibility of near-zero emission steel and relevant technologies (compared to alternatives). 

Leading initiatives for international collaboration: As well as working through relevant international institutions and region-specific initiatives, we note the importance of the following global initiatives to making progress towards and coordinating activities towards this breakthrough goal:

  • Clean Energy Ministerial’s Industrial Deep Decarbonisation Initiative
  • Climate Group’s SteelZero
  • First Movers Coalition
  • Leadership Group for Industry Transition (LeadIT)
  • Mission Innovation Industry Mission
  • Mission Possible Partnership’s Net-Zero Steel Initiative
  • Responsible Steel

We invite all relevant international initiatives to align with this breakthrough.

Participants:

  • Australia
  • Azerbaijan
  • Belgium
  • Canada
  • Denmark
  • Egypt
  • European Union
  • Finland
  • France
  • Germany
  • Guinea Bissau
  • Holy See
  • India
  • Ireland
  • Israel
  • Japan
  • Lithuania
  • Luxembourg
  • Morocco
  • Namibia
  • New Zealand
  • Norway
  • Portugal
  • Republic of Korea
  • Slovakia
  • Spain
  • Sweden
  • Turkey
  • United Kingdom United States of America

Hydrogen

Breakthrough: Affordable renewable and low carbon hydrogen is globally available by 2030.

Global Metrics:  We invite the IEA, working in collaboration with IRENA and the United Nations High Level Climate Action Champions, and other institutions, bodies and industry leaders, to lead an assessment of global progress towards this breakthrough, including reporting on evidence of the following:

  1. Production cost, and cost at point of supply, of renewable and low carbon hydrogen (and affordability and accessibility compared to alternatives).
  2. Volume of renewable and low carbon hydrogen production globally. 
  3. Greenhouse gas abatement, across the full value chain, from the production and take-up of renewable and low carbon hydrogen.
  4. Investments in the research, development and demonstration and deployment, of renewable and low-carbon hydrogen technologies.

Leading initiatives for international collaboration: As well as working through relevant international institutions and region-specific initiatives, we note the importance of the following global initiatives to making progress towards and coordinating activities towards this breakthrough goal:

  • Breakthrough Energy Catalyst
  • Clean Energy Ministerial’s Hydrogen initiative
  • First Movers Coalition
  • Green Hydrogen Catapult
  • Hydrogen Council
  • Hydrogen Energy Ministerial
  • International Partnership for Hydrogen and Fuel Cells in the Economy
  • Mission Innovation Clean Hydrogen Mission

We invite all relevant international initiatives to align with this breakthrough.

Participants:

  • Australia
  • Azerbaijan
  • Belgium
  • Canada
  • Chile
  • China
  • Denmark
  • Egypt
  • European Union
  • Finland
  • France
  • Germany
  • Guinea Bissau
  • Holy See
  • India
  • Ireland
  • Israel
  • Italy
  • Japan
  • Kenya
  • Lithuania
  • Mauritania
  • Morocco
  • Namibia
  • Netherlands
  • New Zealand
  • Norway
  • Panama
  • Portugal
  • Republic of Korea
  • Serbia
  • Slovakia
  • Spain
  • Sweden
  • United Kingdom
  • United States of America
COP26 Logo 'UN Climate Change Conference UK 2021 In partnership with Italy'

02.11.2021

Forests, Agriculture and Commodity Trade

A Roadmap for Action. Joint statement: a shared path forward.

The purpose of the Forests, Agriculture and Commodity Trade dialogue is to promote sustainable development and trade of agricultural commodities while protecting and managing sustainably forests and other critical ecosystems. Addressing these issues together is important because they are strongly interlinked, and because the world can achieve urgent and decisive shifts to the benefit of all countries through greater collaboration.

Agricultural commodities are essential to achieving the Sustainable Development Goals, notably by promoting economic development, reducing poverty, contributing to food security, and improving the livelihoods of billions of people. At the same time, expanding areas for unsustainable agricultural production and other forms of land degradation may pose critical challenges to our environment, the sustainability of forests and other important terrestrial ecosystems, as well as increasing greenhouse
gas emissions, reducing resilience to climate impacts, and contributing to biodiversity loss. Addressing these shared challenges is essential to meeting the goals of the Paris Agreement and the Sustainable Development Goals.

The FACT Dialogue has identified an indicative roadmap of actions set out in a ‘Chairs’ Statement’ on four key and related areas of work which are central to achieving our overall objectives: trade and market development; smallholder support; traceability and transparency; and research, development, and innovation.

We commit to continue our dialogue in an open and inclusive manner, based on our respective national interests, circumstances, and capacities. We will work together to share experiences, find common ground, support implementation, and encourage further ambition in support of our shared aims, respecting and complementing existing multilateral processes. We will meet regularly as Ministers to give direction to this process.

Together, we welcome continued and inclusive dialogue with all governments, as well as civil society groups and the private sector, as we take forward this work over the years ahead.

This statement is supported by:

Belgium

Brazil 

Cameroon

Canada

Colombia

Côte d’Ivoire 

Democratic Republic of the Congo

Denmark

European Union  

France 

Gabon

Germany 

Ghana  

Indonesia  

Italy 

Japan

Liberia

Malaysia

Netherlands

Nigeria

Norway

Peru

Republic of the Congo

Republic of Korea

Spain

United Kingdom of Great Britain and Northern Ireland

United States of America

Uruguay

Chairs’ Statement

In 2021, participants in the government-to-government FACT Dialogue, informed by a multistakeholder taskforce, held discussions on four thematic and related areas: trade and market development; smallholder support; traceability and transparency; and research, development, and innovation.

Informed by the principles for collaboration, the four thematic working groups under the leadership of co-facilitators shared ideas, exchanged best practices and discussed actions that countries could take forward in collaboration. Drawing on these, the co-chairs, the United Kingdom and Indonesia, have identified the actions below for further discussion, development and implementation as appropriate. These actions are non-exhaustive, non-binding and do not apply in all circumstances to all countries. This is a work in progress with participants expressing their desire to deepen collaboration, through this dialogue, after COP26.

1. Trade and Market Development

Issues of trade and markets lie at the heart of the FACT Dialogue. An important priority is to secure and grow market share for sustainably produced agricultural commodities. Collaboration at the global level is crucial, as both demand and supply side measures are needed.

The focus of this working group is therefore on how global markets can better incentivise sustainable agricultural and forest commodity production and trade, while supporting jobs and livelihoods, and protecting forests and other terrestrial ecosystems.

Informed by the discussions held between countries, the co-chairs alongside Colombia, as cofacilitators of this working group, identified the following actions for further discussion, development, and implementation as appropriate:

i. Explore options as to how supply and demand side market and trade policies can be made more complementary and mutually reinforcing to better incentivise sustainable production and consumption. This will help to close the existing gaps between production and consumption policies.

ii. Map how the FACT Dialogue can better support other international processes and fora that address the issues of sustainability in regard to trade and markets.

iii. Build understanding of the common factors necessary for sustainable production in a way that helps establish common expectations among producer and consumer countries. This will draw from experience and existing practice of national and international standards.

iv. Explore ways to strengthen and broaden international market recognition of national approaches to providing assurance of sustainability. This could build common understanding of consumer interests in sustainable practices, as well as national requirements in producing countries, and facilitate market access.

2. Smallholder Support

Smallholder farmers are central to the aims of the FACT Dialogue. Smallholders produce a material share of global production in many of the agricultural commodities that are sometimes associated with deforestation. They face challenges relating to climate change impacts, the security and resilience of their livelihoods, productivity, and capacity. As markets move towards higher environmental standards, smallholders also face the risk of exclusion if unable to meet those standards. Scaling up the support and finance available to smallholders is important to address all of these challenges, but reaching the many millions of small farmers and providing support effectively and efficiently is also a major challenge of logistics and governance.

The aim of discussions under this theme was to consider how to improve conditions for smallholder farmers and support their engagement in actions to reduce deforestation, including through policy reforms and measures to improve security of livelihoods and access to markets, support to strengthen capacity and increase productivity in a sustainable way, and measures to improve access to and availability of finance.

Informed by the discussions held between countries, the co-chairs, alongside Ghana and Malaysia as co-facilitators of this working group, identified the following actions for further discussion, development, and implementation as appropriate:

i. Map and consider existing smallholder support schemes to learn about different approaches, assess the impact of different approaches on sustainability outcomes, identify gaps and begin working on opportunities to strengthen national and international efforts.

ii. Exchange best practice and identify effective approaches to scaling up support and finance for smallholder farmers (including through national support schemes, public-private partnerships, the private sector, the finance sector, and Official Development Assistance (ODA)). This can include support to increase productivity in a sustainable way, reduce vulnerability and increase resilience to climate change, market shocks and other major risks to livelihoods.

iii. Improve access to and availability of finance for smallholders, including to support the transition towards sustainable production; and strengthen enabling conditions including through living income, security of tenure, capacity building, training and technical assistance.

3. Traceability and Transparency

Traceability and transparency are critical to the aims of the FACT Dialogue. Systems and technologies which enable traceability and transparency provide the basis for certification schemes and assurance of origin. They support efforts by national governments to apply and enforce laws which underpin sustainable production, efforts by companies to ensure sustainable sourcing of agricultural commodities, and efforts by stakeholders and civil society to enhance accountability. They can also help to create investor confidence.

The aim of discussions under this theme was to identify measures and opportunities for enhanced collaboration, drawing on technological developments, digital innovation and institutional strengthening, to facilitate increased trade in sustainable agricultural and forest commodities and enhance the protection and the sustainable management of forest and other critical ecosystems.

Informed by the discussions held between countries, the co-chairs alongside Ghana, as co-facilitators of this working group, identified the following actions for further discussion, development, and implementation as appropriate:

i. Assess existing traceability and transparency systems and identify the most significant data gaps that need to be addressed to enable traceability and transparency in international forest and agricultural commodity supply chains.

ii. Develop a set of guidelines, working with international organisations and building off existing initiatives, that will help to inform national government approaches to data sharing and data management on forest and agricultural production, and commodity supply chains. The intention would be for the guidelines to promote compliance with national laws and policies, and enable better monitoring and protection of forests and other critical ecosystems. They would consider and recognise the importance of existing government and stakeholder commitments, costs, technology, interoperability, and accessibility while protecting vulnerable people. In recognition that countries face different challenges in developing their data systems, and to encourage continuous improvement, the guidelines could also recommend ways for governments to further raise ambition. They would also explore in due course how best to apply the guidelines within the international system.

iii. Support countries and stakeholders to identify and access funding, technical assistance and capacity building to strengthen traceability and transparency systems and promote interoperability between systems.

4. Research, Development, and Innovation

Research, development, and innovation are needed to support the aims of the FACT Dialogue in a range of ways. This includes through driving both productivity improvements and intensification in a sustainable way to meet demand for agricultural and forest commodities and, at the same time, minimising expansion of the land area required to grow them; innovations to management practices, such as landscape approaches which balance production with protection; and dissemination of
knowledge to support trade and market development, smallholder support and traceability and transparency themes.

The aim of discussion under this theme was to identify how a broad range of research, development and innovation in the agriculture and forest sectors can support the aims of the FACT Dialogue.

Informed by the discussions held between countries, the co-chairs alongside Brazil, as co-facilitators of this working group, identified the following actions for further discussion, development, and implementation as appropriate:

i. Align our efforts to accelerate innovation in areas most relevant to the objectives of the FACT Dialogue such as sustainable intensification and minimising land expansion, including through One CGIAR, the Agriculture Innovation Mission for Climate (AIM4C), the Global Research Alliance on Agricultural Greenhouse Gases (GRA), global, regional and national research institutes and the coalition in support of the Global Action Agenda on Innovation in Agriculture.

ii. Strengthen capacity of national institutions to undertake and lead research partnerships, and to disseminate and scale best practices among farmers, including through north-south, southsouth, and triangular cooperation.

iii. Identify and disseminate research, development, and innovation to support the aims of the FACT Dialogue, including innovations to management practices, such as landscape approaches which balance production with protection; and dissemination of knowledge to support trade and market development, smallholder support and traceability and transparency schemes.

iv. Invest in and scale up agricultural research and innovation in order to promote more climate-resilient low emissions agriculture technologies and practices.

Closing Remarks

The co-chairs, the United Kingdom and Indonesia, are grateful for the participation of countries in the FACT Dialogue and thank them for the positive and collaborative spirit in which these discussions have been held. The co-chairs also express their sincere thanks to the multi-stakeholder taskforce for bringing diverse perspectives and expert recommendations to inform the Dialogue.

We look forward to progressing this work together in 2022 and beyond, recognising the importance and urgency of this agenda for all countries.

COP26 Logo 'UN Climate Change Conference UK 2021 In partnership with Italy'

02.11.2021

Agricultural Commodity Companies Corporate Statement of Purpose

Recognising the important role of agricultural commodities to address climate change as well as achieve the Sustainable Development Goals, notably promoting economic development, reducing poverty, underpinning food security and improving the livelihoods of billions of people; 

Recognising also the shared responsibility of the agri-commodity sector, including traders, processors, manufacturers, retailers and consumers, as well as governments;  

We, ten global companies with a combined annual revenue of almost 500 billion USD and a major global market share in key commodities such as soy, palm oil, cocoa and cattle, have a shared commitment to halting forest loss associated with agricultural commodity production and trade.

We recognize that significant progress has been made, but this progress must be accelerated and scaled-up to support global efforts in reaching net zero emissions globally by 2050, halting biodiversity loss, and providing sustainable livelihoods. 

So we intend to build on our shared efforts, working with governments, farmers, and other key stakeholders in our supply chains, to accelerate sector-wide action and to identify opportunities for public-private collaboration to catalyse further progress on eliminating commodity driven deforestation.  

By COP 27 we will lay out a shared roadmap for enhanced supply chain action consistent with a 1.5 degrees Celsius pathway, that supports achievement of our goals, and increases collaboration and implementation in areas including: enabling policy environments, transparency on scope 3 emissions and indirect supply chains, and improving livelihoods for farmers.     

Signatories:

  • Mr. Juan Luciano, ADM
  • Mr. Judiney Carvalho, Amaggi 
  • Mr. Gregory Heckman, Bunge 
  • Mr. David MacLennan, Cargill
  • Mr. Wei Dong, COFCO International 
  • Mr. Franky Oesman Widjaja, Golden Agri-Resources 
  • Mr. Gilberto Tomazoni, JBS S.A 
  • Mr. Michael Gelchie, Louis Dreyfus Company B.V. 
  • Mr. Marcos Mulina, Marfrig
  • Mr. Sunny Verghese, Olam International
  • Mr. David Mattiske, Viterra 
  • Mr Kuok Khoon Hong, Wilmar International

With support from the Tropical Forest Alliance, housed by World Economic Forum

The signatories wish to share the following comments about their commitments and progress to date: 

ADM: ADM is fully committed to ending deforestation, and to preserving biodiversity and water resources in our supply chains. This includes holding our suppliers accountable for producing commodities in ways that do not further deforestation in order to reduce impact on climate change. We believe that sustainable, ethical and responsible production by the food industry is critical for curbing global warming, conserving native biodiversity, and upholding the rights of indigenous communities and smallholders. We aim to eliminate deforestation from all of our supply chains by 2030. 

Amaggi: Facing the challenges related to land-use change for greenhouse gas emissions, AMAGGI is committed to having a 100% tracked and monitored grain chain, free from deforestation and native vegetation conversion to agricultural production by 2025, considering all its operations globally. AMAGGI has currently one of the most advanced traceability systems in its sector and has already achieved 99% of zero deforestation and conversion within the tracked chain in 2020-2021, in addition to being the world leader in socio-environmental certifications in the soy chain. 

Bunge: Bunge is committed to finding tangible solutions to address climate change, in both our operations and across our supply chains. Among the most critical efforts is our focus on preserving vital landscapes and rainforests in regions where we source from. In 2015, Bunge made a public global commitment to reach deforestation-free supply chains worldwide by 2025, covering direct and indirect sourcing – the most ambitious at our scale in the sector. Additionally, Bunge has been a founder and active member of leading industry associations and platforms to find practical solutions to common sustainability challenges. Our collective action with partners in both the public and private sectors has led to positive results, and the progress toward our goals has been significant. We are confident that this is the right approach as we continue with our purpose of connecting farmers to consumers to deliver essential food, feed and fuel to the world. Learn more about Bunge’s commitments and progress at bunge.com.

Cargill: Cargill is making progress toward reducing our – and our customers’ – emissions across the supply chain and building climate resilience in agriculture. Together with farmers, we’re working diligently to deliver our science-based climate commitments while developing new markets for carbon, revitalizing landscapes through regenerative agriculture and grazing practices, and protecting forests and their surrounding ecosystems. 

COFCO International: COFCO International is committed to working with partners throughout our value chain to promote concrete actions that address the challenges of climate change and build farmers’ capacity to produce food in a way that respects nature and improves their livelihoods. The progress we make on our sustainability journey enables our business and stakeholders to thrive, while nourishing the needs of future generations. Since 2019, our financing facilities are linked to our sustainability performance and traceability, and more recently to the social and environmental assessments of commodities in areas of risk. Together with our partners, we are advancing deforestation-free soy production by participating in several sector-wide initiatives including WBCSD’s Soft Commodity Forum and ‘Coalizão Brasil Clima, Florestas e Agricultura’. Meanwhile, our participation in landscape initiatives such as PCI in Brazil’s Mato Grosso State is supporting concrete sustainable agriculture projects. We also actively engage our suppliers in low carbon projects, for instance through our joint project with IFC – World Bank in Matopiba.

Golden Agri-Resources: Golden Agri-Resources and the palm oil industry have made substantial progress towards no deforestation. These actions help store large amounts of carbon. We see climate action as a priority, and support the Government of Indonesia in achieving FoLU carbon net sink by 2030 as well as Indonesia’s commitment to reach net zero by 2060. By signing the Corporate Statement of Purpose, we commit ourselves to a 1.5C trajectory and encourage others to take similar action. 

JBS: JBS, which committed to become Net Zero by 2040, already has zero tolerance for deforestation. The company’s geospatial monitoring system uses satellite imagery to check farms against socioenvironmental criteria in every Brazilian biome where it operates. In order to guarantee this same control over the suppliers of its suppliers, JBS has set up its Transparent Livestock Farming Platform, which uses blockchain technology for security and confidentiality. By 2025, JBS won’t buy from producers who are not part of this platform. 

Louis Dreyfus Company: As a global merchant and processor of agricultural goods, Louis Dreyfus Company is committed to helping shape increasingly fair and sustainable food and agricultural production chains. As part of this, we are working in collaboration with customers, suppliers, peers and other value chain stakeholders toward traceable, low carbon and deforestation-free supply chains. We are doing this by leveraging technologies such as satellite monitoring, blockchain and others for traceability, developing projects and initiatives to drive decarbonization across our global operations and supply chains, and engaging farmers – the heart of agricultural production – to find shared solutions to common challenges at landscape level. 

Marfrig: We are absolutely committed to contributing to the reduction of greenhouse gas emissions and, consequently, to the mitigation of climate change risks. Marfrig was a pioneer, in the animal protein segment, to include supply chain monitoring and reduction of methane gas emissions in its goals related to scope 3. Our public commitment is to have a 100% deforestation-free production chain by 2030. But, more than tracing and announcing goals, Marfrig is taking its plans off the ground, by establishing partnerships that reinsert producers, ensuring a truly sustainable production.

Olam: Now more than ever, it is vital to take action to protect our natural environment, people and communities. Sustainable development and economic growth is not a binary choice. Addressing climate change, deforestation and conserving natural resources cannot be dissociated from improving farmer livelihoods, strengthening health, water and sanitation, education and prosperity in rural communities. Coming together to take collective action will enable us to build on our progress to protect forests and landscapes, and advance traceability in supply chains, in order to strengthen and accelerate action to combat the largest global environmental challenges we face. 

Viterra: Viterra wants to demonstrate leadership by continuously monitoring our impact on the environment and communities in which we operate, and to reduce our impact where possible. We have a goal to eliminate deforestation in our supply chains and look after valuable and protected areas. We are seeking to work collaboratively with other industry participants to achieve this goal which requires cooperation along the supply chain from producers through to consumers. These collective statements and actions give us the best opportunity to make the necessary progress to see agriculture make meaningful changes to emissions and environmental sustainability. 

Wilmar: In line with our No Deforestation, No Peat and No Exploitation (NDPE) commitments, Wilmar International is currently preparing to align our climate goals with a 1.5-degree pathway by COP27. We are developing comprehensive targets to reduce our negative climate impacts from our value chain. This includes reducing emissions in our own operations and supply chains, addressing deforestation, halting biodiversity loss and improving livelihoods for farmers and smallholders within these climate-smart production models. These additional comprehensive targets will add to our existing climate related achievements which include achieving an overall 24.4% reduction of GHG emissions intensity for our palm oil mills in FY2020 from our FY2016 baseline, and achieving 56% energy from renewable sources in our FY2020 total group energy consumption. 

COP26 Logo 'UN Climate Change Conference UK 2021 In partnership with Italy'

02.11.2021

MDB Joint Nature Statement

Joint Statement by the Multilateral Development Banks: Nature, People and Planet.

The following MDBs endorse this joint statement: Asian Development Bank, African Development Bank, Asian Infrastructure Investment Bank, Caribbean Development Bank, European Bank for Reconstruction and Development, European Investment Bank, Inter-American Development Bank, IDB Invest, Islamic Development Bank, and World Bank Group.

Preamble 

1.1 Naturei, (including ecosystems and their biodiversity),ii plays a critical role in providing  resources and services that underpin and support the planet and people in terms of: human  health and wellbeing; economic growth, jobs, and livelihoodsiii; food security; and air, water, and soil quality. Nature also plays a crucial role in helping to regulate our climate, acting as  both a carbon sink as well as promoting resilience and adaptation to climate change through  well-functioning and diverse ecosystems. When thriving and intact, nature can also help  reduce the risks of future pandemics, and support a sustainable, inclusive, and resilient  recovery from the impacts of COVID 19. Indeed, recent research such as the IPBES Global Assessment Report on Biodiversity and Ecosystem Services and the Dasgupta Review of the Economics of Biodiversityiv, show, human activity is causing biodiversity loss at an  unprecedented level, with potentially far-reaching systemic implications for wellbeing, livelihoods, and economies. They have also explored the role of nature as capital and a form  of infrastructure. Therefore, progress on global sustainable development, climate and  biodiversity goals cannot be achieved without addressing the direct and indirect drivers of  nature lossv and transforming the way in which we value, use, conserve and share the  benefits from nature.

Building from a solid base 

1.2. We, the MDBs, have mainstreamed environmental sustainability considerations, including nature, into all our policies and operations through the implementation of our environment and social policies, standards, and procedures. We reiterate our commitment to continue assisting our clients avoid, minimize, and manage environmental and social risks and impacts of their operations. 

1.3 We will continue to systematically integrate a gender perspective and consider the different needs of women and men, especially traditional and indigenous communities, in  designing and undertaking actions on the use, management and protection of nature and  environmental sustainability. 

1.4 We will continue to meaningfully engage with traditional and indigenous communities as experts in protecting and managing biodiversity and natural resources, while respecting  their rights to their lands, culture and spirituality. 

1.5 We will build on our experience and track record in risk mitigation and promoting sustainability to support our client countries and the private sector to tackle the interconnected challenges of sustainable development, climate change and nature loss. This underpins our commitments to support client countries to achieve the Sustainable Development Goals, their Paris aligned climate goals and the Convention on Biological Diversity (CBD) goalsvi

Commitments 

1.6 We will further mainstream nature into our policies, analysis, assessments, advice,  investments, and operations, in line with our respective mandates and operating models,  through: 

1. Leadership:  

1.7 We aim to support a sustainable, inclusive, green, and resilient post-COVID recovery,  that upholds our respective environmental, climate, economic, gender, social, and  institutional sustainability standards, supporting green growth and jobs. Through our  respective policy analyses, dialogues, and operations, we contribute to supporting countries  in implementing their commitments made in relation to the Parties’ implementation of CBD,  the Paris Agreement, United Nations Framework Convention on Climate Change, and the  Leaders Pledge for Nature.

1.8 We commit to clearly setting out institutional strategic approaches to further mainstream nature into our analysis, assessments, advice, investments, and operations by  2025. These will inform, where applicable, sector and country strategies/papers. 

1.9 We will work in partnership together and with others and seek to support reforms in the public and private sectors to redirect, repurpose, reform or eliminate environmentally  harmful subsidies, while at the same time scaling up incentives that are either positive or neutral for biodiversity.  

1.10 We will continue to support public and private sector clients to participate in and  benefit from global carbon markets and other green financial products, as appropriate, and in line with their respective priorities, while ensuring environmental integrityvii

2. Tackling the drivers of nature loss by fostering and making ‘nature positive’viii investments:  

1.11 We will work together to begin the process to betterunderstand the financial and systemic risk of nature loss to our public and private portfolios and the current impacts of  our portfolios on nature; and seek to agree on an operational definition of ‘nature positive’ in the context of our operations and investments. 

1.12 We commit to develop projects, business models and/or financing instruments to support economic activity that seeks to reverse the drivers of nature loss and promote the  protection, restoration and sustainable use of nature and its services to people. 

1.13 We will develop, test, and expand the use of innovative instruments to support nature positive investment. 

1.14 We will increase effort on greening finance by helping build an understanding of the  dependencies on nature and the financial risks posed by nature loss to help direct financial flows away from business-as-usual models towards economic activity that addresses drivers of nature loss and generates nature co-benefits.  

3. Fostering national and regional level synergies: 

1.15 Where possible, we will support countries and ministries of finance and economic development and relevant departments/agencies to develop appropriate policies, investment frameworks and agreements that better value and enhance natural assets for  the benefit of all people, including women, vulnerable and marginalized populations while supporting climate and nature goals. 

1.16 We will support government clients to revise their National Biodiversity Strategies and Action Plans (NBSAPs) according to the post-2020 Global Biodiversity Framework, including adjusting policies and relevant investment plans, as needed.

1.17 As appropriate, we commit to support countries to secure high ambition for implementing nature-based solutions (NbS)ix, across their relevant plans and strategies,  including: Long-term Strategies (LTS); Nationally Determined Contributions (NDCs); National Adaptation Plans (NAPs); NBSAPs; and Land Degradation Neutrality (LDN) targets.  

1.18 We will look for opportunities to step up nature financing and efforts to mobilize or leverage private finance for investments in nature, including NbS for climate change mitigation and adaptation with co-benefits for nature and people. 

1.19 We will support client countries and the private sector to identify and access appropriate forms of finance from multilateral climate and environment funds, as appropriate, and leverage additional ordinary capital and private sector finance for ‘nature positive’ investments. This will include supporting countries in delivering their commitments  under climate, biodiversity, and other environmental conventions.  

1.20 We will encourage our public and private sector borrowers to share and exchange biodiversity information through online data portalsix to better inform mainstreaming, project design, and decision-making processes.

4. Valuing nature to guide decision making 

1.21 We commit to use existing and new tools, as these are proven to be appropriate, to  help public and private sector clients better value, sustainably manage, protect, and restore nature and its natural assets to deliver development benefits which include the contribution natural assets make to jobs, livelihoods, gross national income, inclusion, productivity,  health, nutrition, well-being and raising incomes.  

1.22 We will look for opportunities to incorporate the use of these tools into our project and/or country-level decision making, as relevant. We will support countries and private  sector clients with technical assistance, where possible and appropriate, to use these tools to better inform economic planning and decision making. 

1.23 We will share knowledge to help enhance the evidence base and evaluate success and  efficacy of various solutions. 

5. Reporting  

1.24 We will seek to align our objectives and develop tools and methodologies for tracking  ‘nature positive’ investments across our portfolios. 

1.25 We commit to enhancing public reporting on our efforts and initiatives to mainstream  nature in our analyses and operations.

Endnotes. 

iIPBES (2019a), Summary for Policymakers of the Global Assessment Report on Biodiversity and Ecosystem  Services of the Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services, S. Díaz, et al. (Bonn: IPBES Secretariat) and IPBES (2019b), ‘Glossary’, https://ipbes.net/glossary Nature is used to refer to the  natural world with an emphasis on its living components. Within the context of western science, it includes  categories such as biodiversity, ecosystems (both structure and functioning), evolution, the biosphere, humankind’s shared evolutionary heritage, and biocultural diversity. Within the context of other knowledge systems, it includes categories such as Mother Earth and systems of life, and it is often viewed as inextricably linked to humans, not as a separate entity (see “Mother Earth”). 

ii Biodiversity is the variety of life in all its forms, and at all levels, including genes, species, and ecosystems. The CBD defines biodiversity as ‘the variability among living organisms from all sources including, inter alia,  terrestrial, marine and other aquatic ecosystems and the ecological complexes of which they are part; this includes diversity within species, between species and of ecosystems.’ 

iii Benefits of ecosystem restoration include increased employment, increased business spending, improved  gender equity, increased local investment in education and improved human health, well-being, and livelihoods. Investments in nature-based solutions can typically create low-skill and fast-implementing jobs — on average, between 7 and 40 jobs per $1 million invested https://www.wri.org/news/coronavirus-nature-based-solutions economic-recovery. Nature-related jobs are also an important potential source of employment in the green  recovery. A study found that around 11 jobs were directly attributable per USD 1 million investment in  ecosystem restoration projects, while total direct and indirect restoration jobs generated by USD 1 million investment, reached 31.5 https://www.oecd.org/coronavirus/policy-responses/making-the-green-recovery work-for-jobs-income-and-growth-a505f3e7/#endnotea0z19 

iv Dasgupta, P. (2021), The Economics of Biodiversity: The Dasgupta Review. (London: HM Treasury) https://www.gov.uk/government/publications/final-report-the-economics-of-biodiversity-the-dasgupta-review vIPBES 2019 identifies the five direct drivers of change in nature with the largest global impact (starting with  those with most impact) as: (i) changes in land and sea use; (ii) direct exploitation of organisms; (iii) climate change; (iv) pollution; and (v) invasion of alien species. Those five direct drivers result from an array of  underlying causes – the indirect drivers of change and nature loss – which are in turn underpinned by societal values and behaviours that include production and consumption patterns, human population dynamics and  trends, trade, technological innovations and local through global governance. 

vi https://www.cbd.int/development/doc/biodiversity-2030-agenda-technical-note-en.pdf 

vii As per Article 6 of the Paris Agreement  

https://unfccc.int/files/meetings/paris_nov_2015/application/pdf/paris_agreement_english_.pdf viii WEF. Nature positive means enhancing the resilience of our planet and societies to halt and reverse nature loss. A nature positive approach enriches biodiversity, stores carbon, purifies water and reduces pandemic risk. ix IUCN definition for NbS: Actions to protect, sustainably manage, and restore natural or modified ecosystems, that address societal challenges effectively and adaptively, simultaneously providing human well-being and biodiversity benefits. https://www.iucn.org/commissions/commission-ecosystem-management/our work/nature-based-solutions. Natural Climate solutions are a subset of NbS which specifically address the  challenge of climate change e.g. conservation, restoration, and improved land management actions that  increase carbon storage and/or avoid greenhouse gas emissions across global forests, wetlands, grasslands, and agricultural lands. Ecosystem based adaptation is subset of natural climate solutions that harness biodiversity  and ecosystem services to reduce vulnerability and build resilience to climate change. 

https://www.iucn.org/sites/dev/files/import/downloads/ecosystem-based_adaptation_issues_brief_final.pdf E.g. restoration of mangroves to protect coastal populations from storm surges and higher sea levels. This is also aligned to IPBES (2019a) and recent CBD definitions which note that ‘nature-based solutions with biodiversity safeguards are an essential component of ecosystem-based approaches to climate change adaptation, mitigation and disaster risk reduction.’ 

ix Such as the Global Biodiversity Information Facility (GBIF). https://www.gbif.org/

COP26 Logo 'UN Climate Change Conference UK 2021 In partnership with Italy'

02.11.2021

IPLC forest tenure Joint Donor Statement – Spanish

Promoviendo el apoyo a los derechos de tenencia y custodia forestal de los pueblos indígenas y las comunidades locales.

En relación con la Declaración sobre Bosques y Uso de la Tierra emitida por los Líderes de Glasgow el 2 de noviembre de 2021 y su compromiso de “trabajar colectivamente a fin de  detener e invertir la pérdida de bosques y la degradación de la tierra para 2030, logrando al  mismo tiempo un desarrollo sostenible y promoviendo una transformación rural inclusiva”;

Nosotros, los Ministros y representantes de los países y organizaciones que se enumeran al pie de la presente:

Reconocemos la custodia fundamental proporcionada por los pueblos indígenas y las comunidades locales en la protección de bosques tropicales y la conservación de servicios esenciales de ecosistemas, así como la contribución global que hacen a la mitigación del cambio climático, la conservación de la biodiversidad y el desarrollo inclusivo y sostenible. 

Reconocemos los derechos que tienen los pueblos indígenas y las comunidades locales sobre la tierra y los recursos, de conformidad con la legislación nacional  pertinente, la Declaración de las Naciones Unidas sobre los Derechos de los Pueblos Indígenas y otros instrumentos internacionales, según corresponda y que, a pesar de la función importante que desempeñan en la protección de los bosques y la naturaleza, tan solo una fracción pequeña de estas comunidades goza de derechos garantizados de propiedad, gestión y control de tierras y recursos, y tiene acceso al apoyo y a los servicios requeridos para proteger los bosques y la naturaleza y lograr medios sostenibles de subsistencia.

Notamos con preocupación el número creciente de casos de amenazas, acoso y violencia contra pueblos indígenas y comunidades locales.

Vemos con beneplácito el liderazgo político y las medidas adoptadas por numerosos países con el objeto de reconocer y proteger los derechos que tienen los pueblos indígenas y las comunidades locales sobre la tierra y los recursos, de conformidad con la legislación nacional y otros instrumentos internacionales pertinentes, según corresponda.  

Vemos con beneplácito las iniciativas y los esfuerzos de los pueblos indígenas y las comunidades locales por lograr el reconocimiento jurídico de los derechos sobre la tierra y los recursos y por reforzar sus instituciones, organizaciones y redes a fin de apoyar una acción concertada para proteger sus tierras, bosques y recursos.

Nos comprometemos a hacer renovados esfuerzos colectivos e individuales a fin de continuar reconociendo y promoviendo el papel de los pueblos indígenas y las comunidades locales como custodios de los bosques y la naturaleza, compromiso que asumimos junto con gobiernos y otros interesados, destacando en particular el refuerzo de los sistemas de tenencia de la tierra, la protección de los derechos  sobre la tierra y los recursos de los pueblos indígenas y las comunidades locales, y la protección de los defensores indígenas y comunitarios dedicados a salvaguardar los bosques y la naturaleza.

Nos comprometemos a promover la participación y la inclusión efectivas de los  pueblos indígenas y las comunidades locales en la adopción de decisiones y a incluirles y consultarles – asociándonos con ellos – en la elaboración y aplicación  de programas e instrumentos financieros pertinentes, reconociendo los intereses específicos de las mujeres y las niñas, los jóvenes, los discapacitados y otros que frecuentemente quedan marginados del proceso de adopción de decisiones.

Demostramos hoy nuestro compromiso anunciando una promesa inicial colectiva  de financiación por valor de 1.7 mil millones de dólares de 2021 a 2025, a fin de apoyar la promoción de los derechos de tenencia de la tierra de los pueblos indígenas y las  comunidades locales y un mayor reconocimiento y mayores recompensas por su función de custodios de los bosques y la naturaleza. Instamos a otros donantes a aumentar considerablemente su apoyo a esta agenda importante. 

Esta financiación estará dirigida a:

  • canalizar el apoyo a los pueblos indígenas y las comunidades locales mediante  diversas medidas, entre ellas el desarrollo de las capacidades y el apoyo financiero  a actividades de grupos, estructuras de gobernanza y sistemas de gestión  colectivos y medios de subsistencia sostenibles;
  • actividades destinadas a asegurar, reforzar y proteger los derechos de los pueblos  indígenas y las comunidades locales sobre la tierra y los recursos, actividades que  incluyen, sin ánimo de exhaustividad, el apoyo a los trabajos de mapeo y registro de los derechos de tenencia a nivel comunitario, el apoyo a los procesos nacionales de reforma de tenencia de la tierra y los bosques y su aplicación, y el  apoyo a mecanismos de resolución de conflictos.

Con el apoyo de: República Federal de Alemania

Reino de Noruega 

Reino de los Países Bajos 

Reino Unido de Gran Bretaña e Irlanda del Norte 

Estados Unidos de América 

Ford Foundation  

Good Energies Foundation  

Oak Foundation  

Sobrato Philanthropies 

The David and Lucile Packard Foundation 

The William and Flora Hewlett Foundation 

The Christensen Fund  

Children’s Investment Fund Foundation 

The Protecting our Planet Challenge: 

Arcadia 

Bezos Earth Fund 

Bloomberg Philanthropies 

Gordon and Betty Moore Foundation 

Nia Tero 

Rainforest Trust 

Re:wild 

Wyss Foundation 

Rob and Melani Walton Foundation