Paris-Aligned Financial Sector Initiatives

Over the past decade, initiatives aiming to align finance and investment with the Paris Agreement have proliferated, creating a web of interconnected efforts representing trillions of dollars of assets under management. These include the group of alliances under the umbrella of the Glasgow Financial Alliance for Net Zero including those focused on banks, asset owners, asset managers, insurers, financial service providers, and investment consultants.

Realigning financial sector activities is critical to limit global warming and achieve climate justice. Financial sector decisions drive corporate action and capital flows, and they significantly influence the public sector policies that shape the world’s economic systems.

The rapid growth of such initiatives demonstrates the interest of finance sector actors to meaningfully engage in this space. However, there is little clarity or consensus around whether and to what extent their varied commitments will provide the transparency, credibility, and accountability needed to achieve their stated goals.

CCSI has partnered with Environmental Defense Fund (EDF) to critically evaluate net zero financial sector initiatives and opportunities for enhanced alignment with the objectives of the Paris Agreement. 

Together, CCSI and EDF will:

• Map out major ‘net zero’ initiatives for the financial sector and evaluate their ambitions, overlaps, and any gaps;
• Explore what Paris alignment requires of financial sector actors, including commercial banks, asset managers, and asset owners;
• Evaluate the roles for government regulation and international standards to encourage financial sector alignment with the Paris climate goals, and provide recommendations for public, private, and civil society actors toward this objective.

The results of the project will be shared publicly to inform next steps in the financial sector’s path to aligning with the Paris Agreement.