Publications

COP26 in Glasgow did not disappoint in terms of the volume of announcements from the financial sector. But what is behind the hype? While buried in an avalanche of ‘pretty words’, there was notable progress by financial institutions. They now look at the ‘alignment’ not just of what – but also of who – is financed.

In order to understand what public financial institutions can do, I4CE and Ramboll have analyzed 5 territorial projects, from the Vosges to the Dordogne, which are trying to meet the challenge of adaptation. Beyond their differences, each of the cases studied shows that adaptation requires, above all, dedicating time and resources to change the way projects are designed and carried out.

In this study, I4CE reviews the characteristics and areas of intervention of public financial institutions, which make them essential actors for adaptation. The study also reviews all of the Public Financial Institutions' business lines to determine their levers for action.

In the context of the development of the Low Carbon Label, one of the recurring questions from potential financiers is: "What am I allowed to say and do when financing certified low carbon projects? With this publication, I4CE provides operational and pragmatic answers.

The French government has just published the environmental budget assessment, or ‘Green Budget’ of its 2022 draft budget. Morgane Nicol of I4CE and Michel Colombier of IDDRI offer insights into these exercises, which are becoming more popular in many countries and local authorities. They highlight that the environmental budget assessment does not dispense with an Ecological Transition Strategy. Instead, […]

Expectations ahead of COP 26 in Glasgow regarding the contributions of the finance sector are high. Anuschka Hilke from [i4ce] explains that our expectations, however, may not currently be high enough. An impactful contribution to achieving climate goals will require the financial community to go beyond reducing their exposure to climate-related risks.

Explicit carbon pricing systems - a tax or a carbon market - continue to develop around the world. In the 2021 edition of its Global Carbon Accounts, I4CE presents the main trends and provides an overview of these public policies ...

Eating less animal products and wasting less reduces the budget, but increasing consumption of organic products increases it. In total, does adopting a sustainable diet increase or decrease consumer spending?

To learn more about the methodology used by I4CE to assess the contribution of financing flows to the emergence of a sustainable food system, this technical paper introduces it and identifies its limitations and key methodological challenges for the future.

This study takes stock on the experience of some twenty countries and several international development institutions in Environmental Budget Tagging. It identifies the expected benefits and the conditions to achieve them : take into account the measures that are unfavorable to the environment, consider the outcomes of assessed measures and not only their intention, repeat the exercise over time and fit it into the existing administrative culture and processes…

In this op-ed published in a French economic newspaper, Benoît Leguet, director of I4CE, considers that the French Government must plan over the long term the necessary financing for climate change mitigation and adaptation, by instituting a public finance programming law for climate. France has set itself climate objectives, it must clarify what means it will devote to them.

As the main financier of the French and European economies, banks play a key role in financing the transition. Their current contribution in France is in the order of 8 billion euros per year, but this will need to more than double according to estimates by I4CE. To accelerate this shift for banking institutions and to prevent their increasing exposures to climate risks, the debate has tended to revolve around whether or not there is a need to reform prudential requirements.

The IPCC scenarios are constantly cited when we are interested in climate and its evolution, but sometimes wrongly, and often without a clear understanding of what they imply. On the occasion of the release of the latest IPCC report, in which five new scenarios have appeared, Charlotte Vailles of  I4CE explains how they were constructed and what information is available about them. 

Since 2018, and under the initiative of the NGFS, the network of central banks and supervisors for greening the financial system, several central banks and supervisors have begun to conduct their first climate stress test exercises to determine the vulnerability of financial institutions to climate-related risks. In order to help central banks to carry out this type of exercise, the NGFS published in 2020, its first guide to climate scenarios analysis that can be used in climate stress tests.

A core goal of the Paris Agreement is “make finance flows consistent with a pathway towards low greenhouse gas emissions and climate-resilient development.” Since 2015, financial institutions of all types – from development banks to asset owners and pension funds – have committed to making their portfolios ‘consistent’ with the Paris Agreement. In practice, Financial Institutions are at times approaching alignment from different points of entry: either focusing on one hand “what” or on the other hand “who” is financed.

Increasingly frequent heat waves, long droughts, coastal erosion and changing flood risks are all impacts of climate change that will be problematic for the French economy and society. How detrimental this impact will be, will largely depend on what we have anticipated. If we organise ourselves well, we will be able to ensure we make the best decisions for a collective management of risks, development and economic choices, better suited to changing climates. However, regardless of whether we choose to reduce the exposure and vulnerability of populations, facilities and activities upstream or accept an increased share of risk, we must be prepared. 

  Of course, public money will not do everything; but without public money, it seems difficult today to conceive of a transition that is acceptable to all and sufficiently ambitious. With the French presidential campaign about to begin, the budget that the goverment allocates to the transition will certainly be the subject of intense debate. […]

Today, all eyes are on the forthcoming 2021-2025 Climate Action Plan of the World Bank Group as a proxy for what the development finance community’s ambition for COP26 in Glasgow.The Climate Action Plans of Development Banks up until 2020 have been structured around climate finance commitments focusing on increasing their support for climate-specific activities. However, following up on their commitments to “Align with the Paris Agreement”, these institutions need to develop post 2020 strategies and actions plans, which go a step further to meet the level of ambition of the Paris Agreement objectives.

In 2017, the International Development Finance Club (IDFC) together with the group of Multilateral Development Banks (MDBs) made a joint commitment to “align financial flows with the Paris Agreement”. Since its commitment, the IDFC had focused its efforts on identifying what alignment means and implies.

The government has recently modified the environmental, social and governance disclosure obligations for French investors via the publication of an implementing decree which specifies regulator expectations. Romain Hubert of the Institute for Climate Economics explains why this decree was to be expected and necessary for climate reporting.