SUSTAINABLE CORPORATE LENDING: TRANSITION TO A LOW-CARBON ECONOMY CECILE MOITRY BNP PARIBAS GREEN FINANCE CONFERENCE BUDAPEST, NOVEMBER 2019
FRAMEWORKS ARE IN PLACE… Banks and regulators are playing catch up 1951 The Nature Conservancy (NGO) 1968 Club of Rome 1972 UN Environment 1 st World Climate Conference 1979 1989 CERES: NGO 1990 IISD 1992 UNFCCC 1992 UNEPFI 1992 Sustainalytics 1995 WBCSD Kyoto Protoco & 1997 Global Reporting Initiativel 2000 CDP Worldwide 2005 Creation of C40 Climate Leadership 2005 PRI 2007 Grenelle Environnemnt Sustainability Accounting 2011 Standard Boards 2015 COP 21 13 14 12 15 11 16 10 2016 UN SDGs 17 9 1 8 2 7 3 6 4 5 2017 One Planet Summit NGFS - Network for 2017 Greening Financial System FC4S - International Network 2017 of Financial Centre for Sustainability 2018 PRB 2019 EU Taxonomy 2
… AND A COLLABORATIVE ENVIRONMENT TOO Governments, corporates, the financial sector, and civil society now work together to determine how to move the capital required to transition towards a low carbon and socially responsible economy. 17 GLOBAL 12,000+ CEOS COMMIT TO REGULATORS COLLABORATE WITH PRIVATE SECTOR TO INVESTORS COMMIT TO INTEGRATING 2 ° C SCENARIO GOALS FOR 2030 SET GUIDELINES FOR DEFINING SUSTAINABLE FINANCE SUSTAINABILITY ESG IN PORTFOLIO DECISIONS ISSUERS INTEGRATE SUSTAINABILITY INTO FUNDING PROGRAMMES INVESTORS INTEGRATE ESG INTO THEIR PORTFOLIOS Access differentiated investor base, with possible pricing Greater transparency into the products use of proceeds ▪ ▪ advantage to reward transparency Funding Green/Social projects ▪ ▪ Positive public relations message ▪ Meeting commitments as signatories of the PRI ▪ Market solution to social and regulatory pressure to demonstrate ▪ Reporting on climate impacts of fixed income investments to responsible behavior their end asset owner Finance their larger sustainability goals and transition their Financial and reputational risk mitigation ▪ ▪ business 3
THE KATOWICE COMMITMENT When leading banks teamed up in pledge to align lending portfolios with global climate goals 5 INTERNATIONAL BANKS, INCLUDING BNP PARIBAS The Katowice Commitment reflects the pledge made by ING, BBVA, BNP Paribas, Société Générale and Standard Chartered in aligning their loan portfolios with global climate goals. With a combined loan book of €2.4 trillion, the banks committed to measure the climate alignment of their lending portfolios, aim to steer them towards the well-below two- degree goal of the Paris Agreement. 4
EU TAXONOMY: WHAT WE KNOW SO FAR? 5
UNEPFI PRINCIPLES FOR RESPONSIBLE BANKING A framework for a sustainable banking system, helping the industry to demonstrate how to make a positive contribution to society BNP PARIBAS AS A FOUNDING BANK The Principles for Responsible Banking were publicly launched by their 30 Founding Banks on September 2019. It represents more than USD47 trillion in assets coming from 130 banks from 49 countries. They are accelerating the banking industry’s contribution to achieving society’s goals as expressed in the Sustainable Development Goals and the Paris Climate Agreement. This Framework provides 6 principles, key steps for its implementation and a reporting and self-assessment template, which guide bank’s transparency and progress on their impacts. 6
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