Under-Secretary-General of the United Nations, Executive Director of the UN Environment Programme (UNEP)
My thanks for the kind invitation to speak at the Ecumene Global Financial Forum.
The science is clear on the danger and immediacy of the triple planetary crisis of climate change, nature and biodiversity loss and pollution and waste. Climate change is here, now, and intensifying. Resource-hungry growth is eating into the nature that sustains us. And pollution and waste are choking the planet. The triple crisis is a threat to human health, prosperity, and equity. And the triple crisis is a threat to businesses and investors, as the World Economic Forum has made abundantly clear
We know the power that financial institutions must support sustainability in financial decision-making and investing. Provide capital to scale low-emitting technologies and align sectors with science-based targets. Increase demand for climate disclosure from companies. Help high-emitting companies and industries to transition to lower-emitting technologies and business models, while ensuring a just and equitable transition. Set science-based targets across portfolios and increase transparency to avoid greenwashing. And of course, begin moving your financing away from fossil fuel heavy portfolios, as countries work to decarbonize their economies.
The good news is that UNEP’s Finance Initiative-led frameworks and partnerships allow banks and financial institutions to strategically align financial flows with sustainability objectives, and thereby joining a global movement to drive change and prosperity. The Principles for Responsible Investment is the global framework for responsible conduct amongst institutional investors.
Through the Principles for Responsible Banking and the Principles for Sustainable Insurance, the Finance Initiative convenes financial institutions to apply industry frameworks, develop practical guidance and tools, and set targets on environmental and social aspects that align with the Sustainable Development Goals. These frameworks raise ambition beyond just integrating ESG risks to achieve portfolio-wide impacts.
As part of these principles frameworks our Finance Initiative also convenes three major net-zero alliances aimed at fully decarbonising portfolios by 2050. The Net Zero Banking Alliance has about half of global banking industry assets signed on. The Net-Zero Asset Owner Alliance includes more than 70 institutional asset owners with over USD 10 trillion in assets. The Net-Zero Insurance Alliance convenes 25 leading insurers, representing about 12 per cent of world premium.
These alliances drive progress within their organizations, across the financial industry and across the global economy by setting concrete portfolio targets, and engaging companies as they invest to accelerate the global transition to a net-zero world. To avoid greenwashing, the alliances have put in place accountability mechanisms, including require the auditing of the member commitments and progress.
In closing, let me say that sustainability is not optional. ESG is not an add-on, or a selling point, or a PR tool. By making it a core business practice, you can seize the opportunity to position the finance industry to help address society’s challenges in the 21st century. So, I encourage you to join leadership initiatives and alliances and strengthen the resilience of the whole financial system because at the end of the day: our financial systems are dependent on a resilient society and planet. To steer your business towards integrating sustainability considerations fully into financial practice. Because doing so is in the best interests of your people, planet and truly prosperous growth. Thank you.