Finance ClimAct

With the presentation of its “European Green Deal”, the European Commission confirms the priority of rapidly directing investments towards a zero-carbon economy, resilient to climate change. In order to support the implementation of its Sustainable Finance Action Plan of March 2018, the European Commission has just supported the launch of a project bringing together key players in the field in France. The “Finance ClimAct” project aims to provide savers, financial institutions and companies with concrete tools to integrate climate issues into their investment decisions, allowing both to align financial flows with zero-carbon objectives and to strengthen the resilience of the financial system to climate risks.

Objective:

In order to make France a pilot market for climate finance in Europe, the Finance ClimAct project has three main objectives:

• To equip financial institutions to assess the risks and opportunities related to climate change in the activities they finance;
• To support companies and financial institutions in defining and monitoring their climate change objectives and to enable banks, industrialists and their partners to increase their skills in implementing energy efficiency and low carbon projects;
• Involve individual savers by helping to better understand and take into account their environmental preferences, by supporting the deployment of the European Ecolabel on financial products, and through public awareness campaigns.

I4CE is engaged in this project to carry out the following tasks:

Capacity building of supervisors and financial institutions in climate risk assessment and climate stress testing:

• Development of reports providing background information, review of best practices and technical advice on climate risk management and stress testing.
• Strengthening the technical capacity of relevant NGFS member bank supervisors to conduct prudential climate stress tests.
  Preparation of technical inputs for workshops on climate stress testing with interested stakeholders (financial institutions, supervisors and regulators, experts, academics, etc.).

Capacity building of financial actors in climate-related disclosure:

• Production of guidelines on good reporting practices in terms of metrics and organisation of the disclosure process
• In-depth analyses on specific metrics or themes (e.g. on transition risk disclosure).

Project website

Partners:

The Ministry of Ecological  Transition (MTE) has brought together eight actors on an unprecedented programme with a budget of €18 million and €10 million in funding from the European Commission (LIFE  Projects). Coordinated by the French Environment and Energy Management Agency (ADEME), it brings together the MTES, ADEME, the French Financial Markets Authority (AMF), the French Prudential Control and Resolution Authority (ACPR), the 2° Investing Initiative (2°ii), the Institute of Economics for Climate (I4CE), Finance for Tomorrow (F4T) and GreenFlex.