How to align with the Paris Agreement – A Resource Note for Banking Associations and Banks

How to align with the Paris Agreement – A Resource Note for Banking Associations and Banks is the title of the document published today by CECA, the Spanish Banking Association (AEB), the Dutch Banking Association (NVB) and the German network Net Zero Banking Alliance Germany-Green and Sustainable Finance Cluster Germany, alongside the Net Zero Banking Alliance (NZBA) of UNEP FI.

In 2015, the Paris Agreement – an international treaty on climate change – was signed with a global action plan to limit the planet’s warming to well below 2°C and continue efforts to limit it to 1.5°C. At the international, European, and national levels, various initiatives such as the Principles for Responsible Banking from the United Nations Environment Programme Finance Initiative (UNEP FI), strategic regulations like the European Union’s Sustainable Finance Action Plan, and national climate laws provide the necessary frameworks for aligning with the Paris Agreement.

The need for the financial sector’s involvement in contributing to the fight against climate change is a reality that is beyond question, and it is the financial industry itself that is taking a step forward in its collaborative efforts to support new productive models by channeling aid and promoting public-private collaboration. Banking entities can play a relevant role in the path towards a fair and equitable climate transition. In this context, banking associations and banks have been developing various commitments for years to support companies in reducing greenhouse gas emissions.

On the occasion of the United Nations Climate Change Conference (COP25), held in Madrid in December 2019, the leading banks and savings banks in Spain, including CECA and its associated entities, presented a joint commitment to reduce the carbon footprint in their credit portfolios, in a manner that can be measured by internationally standardized criteria and in line with the objectives of the Paris Agreement. In this way, the entities were already aligning with the “Collective Climate Action Commitment” promoted by UNEP FI. Furthermore, in January of the same year, CECA ratified its adherence to the Principles for Responsible Banking of UNEP FI with the aim of contributing to achieving a sustainable future. The Principles for Responsible Banking constitute the most important framework for sustainable finance at the global level.

The document How to align with the Paris Agreement – A Resource Note for Banking Associations and Banks provides new information to assist banks and banking associations in aligning their climate commitments with the Paris Agreement through the formulation of joint objectives via commitments and collaboration opportunities.