Accelerating Fair Finance Flows for Climate Solutions
High-Level Climate Champions
H.E. Ms. Razan Al Mubarak and Ms. Nigar Arpadarai are the High-Level Climate Champions for #COP28 and #COP29.
Welcome to the Top of the COP daily newsletter, brought to you by the UN Climate Change High-Level Champions. Every morning for the duration of COP 29, the Top of the COP will highlight action of real-economy actors — businesses, investors, cities and regions, Indigenous Peoples and youth — accelerating progress towards 2030 goals.
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Driving the day?
Accelerating finance for climate solutions:?COP 29 gets underway with private finance leaders showcasing increases in commitments, action and investments in climate solutions in 2024, and calling for ambitious policy outcomes at COP 29 to enable greater action. ?Private sector representatives at COP 29 continue to call for a high-ambition, actionable climate finance package, including investable NDCs, that gives markets the confidence to invest where it is needed most.
Today, updated analysis from the Independent High Level Expert Group (IHLEG) on Climate Finance outlines how a transition to clean, zero carbon energy, building resilience to the impacts of climate change, coping with loss and damage, protecting nature and biodiversity, and ensuring a just transition, requires a rapid step-up in investment in all countries.
Private finance is flowing?
While more is urgently needed, private finance continues to show leadership, and the benefits of climate aligned investment and action. The Race to Zero campaign now includes more than 650 financial institutions across all parts of the financial system taking immediate action to halve global emissions by 2030. Members of the Net-Zero Asset Owner Alliance, a Partner of Race to Zero redirected? USD 555 billion in combined investments in climate solutions in 2023, marking a quadrupling since 2020. These climate solutions investments include corporate bonds, real estate, listed equity, infrastructure and private markets.?
More than 500 business and financial institutions are advancing at least one of the actions of the Nature Positive for Climate Action initiative, including adoption of science-based targets, and commitment to the Taskforce on Nature-related Financial Disclosures (TNFD), representing a threefold increase since COP 28.
In its third year, the Regional Platforms for Climate Projects work, launched by the High-Level? Champions and the UN Regional Economic Commissions, is now collaborating with 11 partners to mobilise climate investments in developing countries. Together they are increasing collaboration among policymakers, financiers, project developers and technical assistance providers. This year’s forums identified an additional 19 investable projects in Latin America and Europe reflecting investment opportunities to advance regional needs and priorities.?
These innovative investable projects include; a battery factory in Serbia, a reforestation firm using drones to build resilient ecosystems in French Guiana and Brazil, biochar initiatives using food waste to store carbon in the ground in different countries, data-driven companies using AI to mitigate climate risks and improve water use in food systems in Latin America, and a biotech company working to increase agricultural yields and restore degraded soil across South America. Collectively, these projects are seeking close to USD 3 billion in investments. More details of the projects can be found here: Latin America and Europe.
Overall investment trends are also ticking up. The World Business Council for Sustainable Development (WBSCD): The Business Breakthrough Barometer 2024 found that three-quarters of leading businesses surveyed report having increased their investments in the net zero transition over the past three years with 90 per cent saying they would invest more if targeted sector policy measures were implemented. Analysis by the Climate Policy Initiative suggests climate finance flows are likely to have surpassed an estimated USD 1.5 trillion in 2023.
Building a highway for finance
Today, the COP 29 Business, Investment and Philanthropy Climate Platform (BIPCP) event, co-convened by the COP 29 Presidency and the High-Level Champions, will showcase these advances and more, emphasising how business, investors and philanthropies can effectively collaborate to increase finance flows to where it is needed most.
Participants will include? Mikayil Jabbarov, Minister of Economy, Azerbaijan;; and Racquel Moses, CEO of the Caribbean Climate Smart Accelerator, as well as representatives from the International Finance Corporation (IFC), the Bill and Melinda Gates Foundation and the World Economic Forum. Sessions will highlight diverse financing strategies and approaches that they and their many partners are pursuing to drive financial flows to the actions and solutions needed to achieve the 2030 Climate Solutions.?
The? CREO Family Office Syndicate (CREO) and the Investor Leadership Network (ILN) — a CEO-led group of 14 global institutional investors with over USD 10 trillion in assets under management — jointly representing their members including family offices/foundations, pension funds, insurers and sovereign wealth funds, will announce that they are uniting to develop a shared vision and action plan to accelerate the deployment of private capital, working with enabling partners including Builders Vision, CDPQ and the Milken Institute.
The Glasgow Financial Alliance for Net Zero (GFANZ) will speak to its focus on enhancing voluntary transition planning guidance, and the over 50 organisations supporting the Global Capacity Building Coalition platform designed to be a go-to global resource for financial institutions developing climate action strategies, particularly in emerging markets and developing economies (EMDEs). Work to unlock private finance in EMDEs? has included a World Bank Private Sector Lab, a Nature Investment Lab, and high integrity carbon markets.?
The BIPCP, taking place in the Blue Zone for the first time, highlights the strong voices of investors, philanthropies, and businesses, calling for a fair and ambitious climate finance outcome at COP 29, and noting the importance of clear policy to enable further action. The BIPCP is an opportunity for the private sector to offer their leadership, capital, and insights to support and inform the critical work of national governments here at COP.???
Recent insights and calls include:
Businesses and investors are sharing their insights and solutions for investment-enabling policies and trade for climate as part of the COP 29 Presidency’s Baku Initiative for Climate Finance, Investment and Trade (BICFIT) event happening today to foster integration of the global trade and climate agendas.
Insurance Breakthrough
A new paper published by the High-Level Champions and global insurance group Howden, demonstrates the critical role the insurance sector can play in accelerating decarbonisation and increasing resilience. The USD 19 trillion in investment capital that has already been committed by energy companies, governments, and private equity to financing the climate transition through to 2030 is estimated to require USD 10 trillion in innovative insurance cover in order to meet investor risk requirements.?
The paper cites examples of innovative insurance solutions that have the greatest potential to help rapidly enable the delivery of the 2030 Breakthroughs - specific sector targets to keep global warming within 1.5 °C. Examples include a risk-mitigating solution which facilitated the development of a plastics renewal facility? designed to process 100,000 tons of plastic waste annually;? political risk insurance cover for Senegal’s first large-scale renewable energy Project; and integrating mangrove restoration with asset protection insurance to protect a wind power project, left vulnerable to tidal erosion and storm surges due to the degradation of surrounding mangroves.?
?Net Zero Export Credit Agencies launch target-setting guidance.
The UN-convened and Race to Zero partner, Net-Zero Export Credit Agencies Alliance (NZECA) launched its target setting guidance at COP 29? yesterday. It is the first tool of its kind to enable export credit agencies (ECAs) and export-import (ExIm) banks to set net-zero targets and put them into action to accelerate their decarbonization ambitions.?
This first version provides guidance to members on setting long-term and intermediate science-based climate targets and related disclosures, helping members to fulfil the commitments they have made when joining the Alliance.? NZECA also announced its membership extension welcoming Finland’s Finnvera.?
Accelerating the net zero transition of high emitting sectors?
The Breakthrough Agenda will launch the ‘Baku’ Priority International Actions, a set of actions to be implemented by governments and non-State actors in 2025, aimed at accelerating the decarbonisation of five high emitting sectors: power, hydrogen, steel, road transport, and buildings. These include coordinated action at the international level and between the public and private sectors on? standards and certifications, demand, finance and investment, research and development, marking? is a critical step forward on the path to a net zero economy. As highlighted in the recently released Breakthrough Agenda Report 2024 authored by the IEA and the High-Level Champions, good progress has been made in some areas, but we need more ambition, more action and more international collaboration in all sectors.?
Green fuels for green shipping: a call to action
A good, concrete example of that action and collaboration, today 55 actors from across the maritime value chain, including 15 suppliers and 19 demand organizations have launched a set of commitments to achieve a minimum 5% - whilst striving for 10%? - uptake of zero emission fuels in international shipping. This is urgently required to achieve a just and equitable transition in line with the Green Shipping 2030 Climate Solutions.??
These commitments focus on supply, demand and finance and call on policy makers to maximise the success of the 2030, 2040, and 2050 goals of the International Maritime Orrganization’s 2023 GHG Strategy, and minimise the cost of shipping’s transition. The group is led by think tank RMI, with UK university UCL and the United Nations? Foundation serving as experts, supported by the High-Level Champions.?
Supporting Net Zero Policy?
The inaugural report from The Taskforce on Net Zero Policy finds insufficient overall progress of policy reforms needed to align the activities of large corporates with a 1.5°C goal, but does include examples of progress.? It notes policies related to net zero action for companies and financial institutions, often in middle income countries and developing economies, such as? South Africa, Nigeria, Argentina and Indonesia. The report also found action on implementing actionable sustainable finance, like taxonomies and transition plans, has advanced around the globe.
Spotlight on SMEs
Yesterday, the International Trade Centre (ITC) endorsed the Baku Climate Coalition for SMEs, Green Transition Declaration and signed a partnership with the Small and Medium Business Development Agency? of the Republic of Azerbaijan (KOBIA) and the Brazilian Support Service for Micro and Small Businesses (SEBRAE) to roll it out. The SME Declaration aims to help establish small businesses as a key stakeholder group in advancing the green transition ahead of COP 30 in Brazil.
To support the implementation of the Declaration,? ITC will today launch its NDC 3.0 guidelines for countries to work with small businesses to design their Nationally Determined Contributions.?
Making an impact
In the face of a climate emergency, solutions are emerging faster than ever, tackling every aspect of the challenge. The High-Level Champions’ new series, Impact Makers, shines a spotlight on those leading this change from the ground up.?
Discover today’s Impact Makers, revolutionizing how we finance solutions that pave the way to a healthier and fairer world.
NGA TRAN THI THANH (JESSICA) – Accelerating Vietnam’s transition to a low-carbon economy through blended finance
GILBERTO RIBEIROL – Leading climate finance innovations for sustainable energy and land use in Brazil
LYNN VON KOCH-LIEBERT – Driving equity and access in climate finance through private lending and community partnerships
Youth voices?
Climate Champions’ Youth Fellow, Amal Ridene sheds light on scaling adaptation finance at COP 29, where adaptation funding and private sector engagement are central to closing the climate resilience gap. As finance remains underfunded, she explains how COP 29 offers new opportunities for impactful investment in adaptation.
Call for inputs: COP 29 climate action announcements
?The UNFCCC secretariat is tracking climate action announcements made at COP 29, including the launch of:?
This information will be used to inform the Global Climate Action Portal (GCAP), formally known as Non-State Actor Zone for Climate Action (NAZCA), in particular, on its COP 29 event page. Please find the online form to submit your inputs here or via the QR code below.
About the High-Level Champions: The UN Climate Change High-Level Champions drive ambitious climate action by connecting the work of national governments with the many voluntary and collaborative actions and initiatives from non-Party stakeholders such as cities, regions, businesses, investors and civil society. This includes delivering the five-year plan of the Marrakech Partnership for Global Climate Action, in collaboration with the UNFCCC secretariat and other partners, using the tools and frameworks included? in the? 2030 Climate Solutions. H.E. Razan Al Mubarak and Ms. Nigar Arpadarai serve as the current High-Level Champions of the COP 28 Presidency and the COP 29 Presidency, respectively.