When governments, industry leaders, scientists, and
non-governmental organisations (NGOs) meet in Glasgow in November 2021 for the 26th
UN Climate Change Conference of the Parties (COP26), the question of how to
accelerate climate action will be on top of everyone’s agenda.
“Uniting the world to
tackle climate change” will require all parties to collaborate in this year’s COP26 on five core themes: clean energy, clean
transport, nature-preserving solutions, adaptation and resilience and climate finance.
Finance is now recognised as an
essential lever in accelerating the scaling up of sustainable actions across the
economy, and the banking sector is actively creating coalitions to mobilise the
entire industry.
As part of BNP Paribas’ commitment to playing its part
in climate action, the bank participated in two significant initiatives this
week: the launch of the Financial Services Task Force (FSTF) and discussions on
the
Economics of Biodiversity at the virtual event “COP26: One Earth One Future,” a dialogue on nature,
adaption and resilience.
Launch of the Sustainable Markets Initiative’s (SMI) Financial Services Taskforce (FSTF)
Under the climate leadership of HRH The Prince of
Wales, BNP Paribas CEO Jean-Laurent Bonnafé with 11 other global banking
executives announced on 18 February the creation of the
Financial Services Task Force (FSTF), a progressive industry group launched by the
Sustainable Markets Initiative (SMI). Ahead of COP26, the taskforce will focus
on:
Reducing carbon emissions to define a credible transition pathway for
banks to move towards a low carbon economy
Increase private investment into sustainable infrastructure projects
Develop climate solutions including evolving carbon markets
HRH The Prince of Wales
said: “The Financial Services sector has a vital role to play as a catalyst and
driver for change across other industries. I am delighted that the Financial
Services Task Force has come together under the SMI umbrella to identify ways
to set our planet on a fundamentally more sustainable trajectory.”
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“The Economics of Biodiversity”
Understanding how to
value nature across the economy is a critical aspect of managing risks and
preventing biodiversity loss. Putting a price on nature, natural resources and
natural capital, will help put a financial cost on its loss, and is the objective
of the Taskforce for Nature-related Financial Disclosures (TNFD).
As co-chair of the
TNFD, BNP Paribas Head of Company Engagement Antoine Sire discussed the
findings of the Dasgupta Review on ‘The Economics of Biodiversity’ and the
important role of the finance sector to support nature-based solutions at the
Wilton Park “COP26: One Earth One Future” virtual meeting. During the event,
Sire explained how TNFD improves the frameworks for decision making to ensure
that the finance industry can advance the measurement, traceability and
management of nature-related risks. The coalition encourages cross-sector
knowledge sharing, collaborating with conservationists, economists, investors,
corporates and scientists to increase the understanding of valuing nature.
The ultimate aim is
for the TNFD to enable nature-positive outcomes and identify new opportunities
for investing in initiatives and approaches that scale up biodiversity focussed
solutions. On the systemic importance of the initiative, Sire said: “the
disclosure and frameworks we are doing with TNFD are absolutely necessary for
the kind of shift which is expected from business”.
The World Economic
Forum (WEF) estimates that action for nature-positive transitions could
generate over $10 trillion of annual business value and up to 395 million jobs
within the next decade. WEF also estimates that the risk of not engaging in
scaling up nature-based solutions is significant, given that $44 trillion –
roughly over 50% of global GDP – is either highly or moderately dependent on
nature and its services.
BNP Paribas’ Key actions on climate & biodiversity Protecting
nature & climate: BNP Paribas has a range of sector policies on
coal, shale-gas and tar sands aimed at protecting natural capital. In May 2020,
BNP Paribas extended its coal exit policy to all OECD countries as part of its
target to end the use of coal by its clients in the electric power sector by
the end of 2030. In February 2021, the bank announced a strengthening of its financing
policies, defining restrictive criteria to accelerate the progress of its
customers in terms of fighting against deforestation and ensuring traceability.
As a result, BNP Paribas will only provide financial products or services to
companies (producers, meat conditioners and traders) with a strategy to achieve
zero deforestation in their production and supply chains by 2025 at the latest.
Supporting
climate research: Since 2010, the BNP Paribas Foundation has financed
the Climate & Biodiversity Initiative and provided €18 million for 27
research projects.
Managing
portfolio transition: In 2018, BNP Paribas joined forces with four other
large banks to develop a common methodology for measuring and aligning our loan
portfolios with the goals of the Paris Agreement. This methodology, called
PACTA, covers the utilities, automakers, and oil & gas sectors, as well as
other sectors across transportation and heavy industry.
Scaling
up sustainable finance: Overall, sustainable finance aims to support the
transition to a low carbon economy by providing financing and investment
capital to companies who are engaging on transition. BNP Paribas credentials
include:
#1 in the 2020 Sustainable Bonds ranking,
supporting issuances for clients across the SSA, FIG and corporate sectors (Bloomberg)
#1 in 2020 for sustainable loans mandated arrangers
(Refinitiv Sustainable Finance League Tables)
#1 arranger in Global Sustainability Linked Loans
in 2020 (Bloomberg)
