Yesterday, the UN Secretary-General’s Special Envoy on Climate Ambition and Solutions, Michael R. Bloomberg – alongside senior leaders of multilateral development banks, finance, and international organisations – announced the launch of the Global Capacity Building Coalition.
The collaboration, they said, is set to increase the availability and effectiveness of climate finance technical assistance programs for financial institutions in emerging markets and developing economies (EMDEs).
The Coalition brings together some of the world’s leading climate finance organisations, with the aim of enhancing collaboration and responding to growing requests for capacity-building support from financial institutions in EMDEs to meet the aims of the UN and the G20 Sustainable Finance Working Group (SFWG).
António Guterres, United Nations Secretary-General, said: “The fight against climate chaos depends on cooperation, collaboration, and capital. This welcome initiative brings these vital ingredients together. We must unite around the priorities of developing countries, to get finance where it is needed and power a surge in climate action. The lives and livelihoods of people around the world depend on it.”
Michael R. Bloomberg, UN Secretary-General’s Special Envoy on Climate Ambition and Solutions, said: “This is the broadest coalition ever assembled to increase finance for clean energy and resilience in the global south. The coalition is well-positioned to help more nations fight climate change in ways that promote economic growth, environmental resilience, and public health — and to do so through collaborative partnerships that empower nations to act boldly.”
Chaired by Mary Schapiro, the Coalition marks the first time such a broad group of leading actors in climate finance capacity building have come together to work collaboratively to extend support for EMDEs.
Founding participants and observers of the Coalition include:
● African Development Bank (AfDB)
● Asian Development Bank (ADB)
● Asian Infrastructure Investment Bank (AIIB)
● Bloomberg Philanthropies
● European Bank for Reconstruction and Development (EBRD)
● Glasgow Financial Alliance for Net Zero
● The Global Blended Finance Alliance
● Green Climate Fund
● Finance in Common (FiCS)
● Inter-American Development Bank (IDB)
● International Monetary Fund
● International Sustainability Standards Board (ISSB)
● Network for Greening the Financial System (NGFS)
● Principles for Responsible Investment (PRI)
● United Nations Climate High Level Champions
● United Nations Development Programme (UNDP)
● United Nations Environment Programme Finance Initiative (UNEP-FI)
● United Nations Framework Convention on Climate Change (UNFCCC)
● The World Bank Group
The Coalition highlighted that EMDEs will require $2.4 trillion in annual climate finance by 2030 to build resilient, sustainable economies and enable the global transition to net zero.
Half of this finance is expected to come from domestic resource mobilisation, further, it shared that domestic financial institutions will be critical financiers and intermediaries for providing this capital.
However, it highlighted that many financial institutions in EMDEs are earlier on in their climate journey, and the net-zero pathway is often difficult to navigate and resource-intensive.
“The landscape is evolving quickly as climate risks increase, global public policy evolves, and the need for transition and adaptation finance becomes increasingly acute. Credible transition plans and climate disclosure are vital, and most financial institutions require support to understand and implement emerging best practices, tailored to the risks and opportunities they face,” it said.
The Coalition will focus on seven specific priorities:
- Facilitate the enhanced delivery of capacity-building support to financial institutions in EMDEs with upskilling, technical assistance, and transition finance resources.
- Identify gaps and develop additional resources required to fill technical or market-specific gaps. Where capacity needs for scaling sustainable finance are not covered by existing tools or resources, recipients will be able to request new resources to address gaps.
- Focus on adaptation and resilience and seek to embed leading knowledge on adaptation into private finance decision-making.
- Establish knowledge-sharing mechanisms and create an online platform for training, learning, and requesting technical assistance to accelerate accessibility and delivery.
- Support the uptake of emerging global best practices and standards, such as the ISSB’s global sustainability disclosure standards.
- Drive collaboration between all stakeholders involved in capacity building and avoid duplication of efforts and resources.
- Increase philanthropic funding to support climate disclosures, transition planning, and adaptation finance in EMDEs.