Aligning finance with the Paris Agreement: Treasury Minister John Glen MP speaks at climate change roundtable
The All-Party Parliamentary Groups on Climate Change and Sustainable Finances this week co-hosted a roundtable discussion on aligning finance with the Paris Agreement, a central but often overlooked part of the Agreement.
We were delighted to hear introductory remarks from Treasury Minister John Glen MP at the event, co-chaired by Caroline Lucas MP, Chair of the APPG on Climate Change and Alex Sobel MP, Vice Chair of the APPG on Sustainable Finance. Further presentations were then given by Zoe Knight, Group Head, HSBC Centre of Sustainable Finance and Simon Youel, Head of Policy and Advocacy, Positive Money.
This roundtable discussion considered Article 2.1.c of the Paris Agreement, which commits parties to ‘making finance flows consistent with a pathway towards low greenhouse gas emissions and climate-resilient development’. However, issues with defining and measuring Article 2.1.c mean it is very hard to track progress towards this goal. The roundtable therefore explored the need and value of tracking progress towards Article 2.1.c in a transparent and accessible way, looking at the different uses of a potential ‘finance tracker’ to do this.
Co-chair, Caroline Lucas MP, opened the roundtable discussion by inviting participants to consider the following questions:
- How would a regular assessment of financial alignment with the Paris Agreement help in driving the transition to net zero?
- What barriers exist to establishing a comprehensive assessment of financial alignment, and how can these be overcome?
Participants discussed the role of central banks and other regulators in aligning finance with climate action and the need to act on the existing data around this without further delay. The discussion also considered regulating private finance and incentivising green investment. It explored the transparency and labelling of green financial products, and a commitment for the UK to have the world’s first net zero financial system.
The discussion overall highlighted the need for urgency of action around financial alignment consistent with climate goals. Participants also noted the value of a consistent and credible assessment of investment needs for net zero and climate resilience. This is especially important to consider in the lead up to the global stocktake of the Paris Agreement in 2023.