Just ahead of talks in Paris aimed at sealing an international accord on climate change, leading finance groups are rolling out a set of principles to ensure that climate actions are becoming core to the activities of financial institutions.
The voluntary principles will be formally launched at the COP21 Paris discussions. The initiative was initially developed jointly by the Multilateral Development Banks and the International Development Finance Club of national and regional development groups.
The initiative acknowledges that financial institutions can do yet more to ensure that climate finance is scaled up and flowing towards investments that support low-carbon and climate resilient development.
The result is a set of “Voluntary Principles for Mainstreaming Climate Action within Financial Institutions” that ensure that climate change considerations are not incidental but a core to the activities of financial institutions.
They outline how financial institutions can:
• Commit to climate strategies,
• Manage climate risks,
• Promote climate smart objectives,
• Improve climate performance, and
• Account for climate action.
In an important step to broadening this initiative, a number of private sector banks have already signed up to the principles.