At COP21, a coalition of the world’s leading financial institutions officially signed on to five voluntary Principles to Mainstream Climate Action into their operations.
The landmark move was undertaken by 26 financial institutions, from both the public and private sectors, from developing and developed countries. The institutions together are worth a total value of more than $11 trillion.
By signing onto the voluntary principles, the financial institutions are pledging to continue to integrate climate considerations into their investments and advisory functions, in an effort to scale up their efforts to address climate change, thereby “greening” operations over time.
The principles highlight practical, operational approaches to integrate climate into the core investments and advisory functions of a financial institution.
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.
These principles have been developed based on practices implemented by financial institutions worldwide over the last two decades.
“With Asia and the Pacific one of the most vulnerable regions to climate change, ADB now screens all its projects for climate risks. Moreover, by 2016, it is targeting 45% of all operations to address climate change,” said Bambang Susantono, ADB vice-president for Knowledge Management and Sustainable Development.