Menu
FR
search
Publications

Climate and development finance institutions

9 October 2015 - Climate Report - Special issues - By : Ian COCHRAN, Phd

Climate and development finance institutions: linking climate finance, development finance and the transition to low-carbon, climate-resilient economic models

Paper one in I4CE’s research project on the standards, tools and metrics to support the mainstreaming of ‘Low-Carbon Climate-Resilient’ growth pathways into activites of development finance institutions.

Abstract
Development finance institutions (DFIs) are in a position to be key actors in aligning development and the 2° challenge. One of the principal challenges t oday is to scale-up the financial flows to the trillions of dollars per year necessary to achieve the 2°C lo ng-term objectives. Achieving this transition to a low-carbon, climate resilient (LCCR) economic model requires the integration or ‘mainstreaming’ of climate issues as a prism through which all investment decisions should be made. This paper presents an overview of the opportunities and challenges of linking a LCCR transition with the objectives of development finance. It first presents the two-fold challenge of climate change and development for
countries around the world. Second, the paper explores the role of development finance institutions and their support for the transition to a low-carbon, climate-resilient economic model. Finally, it examines a necessary paradigm shift to integrate climate and development objectives to establish a ‘LCCR development model’ able to simultaneously tackling development priorities and needs for resilient, low-carbon growth. This will necessitate a move from focusing on a ‘siloed’ vision of climate finance to a means of aligning activities across the economy with the LCCR objectives to ensure that the majority of investments are coherent with this long-term transition.

The research project under which this paper was elaborated received financial support from Caisse des Dépots and Agence Française de Développement during its first phase. The research presented in this publication was carried out by I4CE on an independent basis. CDC group and AFD are not liable under any circumstances for the content of this publication.

Climate and development finance institutions
To learn more
  • 11/07/2025 Foreword of the week
    COP30: On Financing, the Time for Negotiation Is Over

    “What agreement will the negotiators reach?” is the question that is usually on climate practitioners’ minds at this time of the year. However, this time, it is a new impetus that is needed, not another agreement. 10 years after the Paris Agreement, the Brazilian COP30 presidency has rightly shifted the focus to execution, making this edition “the implementation COP.” On financing, the objectives set at COP29 are clear: developing countries should receive $300 billion per year by 2035 from developed countries (NCQG), and mobilise $1.3 trillion per year from all actors. The newly published “Baku to Belém” roadmap proposes solutions to meet the targets. We now have objectives and a list of (theoretical) means to achieve them. How do we move to implementation? 

  • 11/05/2025 Blog post
    From Pledges to Progress: Climate Finance a Decade After Paris

    Nearly a decade has passed since the Paris Agreement elevated finance to the heart of the climate agenda, embedding in Article 2.1(c) the ambitious goal of aligning global financial flows with low-emission, climate-resilient development. But for all the talk of “shifting the trillions,” we remain far from course. 

  • 10/31/2025 Foreword of the week
    A Paris Climate & Nature Week with a touch of ‘green budget’

    We were proud to contribute to the inaugural Paris Climate & Nature Week hosted by Sciences Po from 27 to 29 October, marking the 10 years of the Paris Agreement. I4CE weighed in on some of our core topics– lessons learnt over the past decade of climate action which can accelerate the  transition; the links between climate and development finance; as well as adaptation and the cost of inaction.

See all publications
Press contact Amélie FRITZ Head of Communication and press relations Email
Subscribe to our mailing list :
I register !
Subscribe to our newsletter
Once a week, receive all the information on climate economics
I register !
Fermer