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, together with Net Zero Banking Alliance (NZBA) from UNEP FI.
In 2015, the Paris Agreement - an international treaty on climate change - was signed with a global action plan to limit global warming to well below 2° C and to continue joint efforts to limit it to 1.5° C. At the international, European and national levels, various initiatives such as the United Nations Environment Programme Finance Initiative (UNEP FI) Principles for Responsible Banking, strategic regulations such as the European Union's Sustainable Finance Action Plan and national climate laws provide the necessary frameworks to align with the Paris Agreement.
The need to involve the financial sector in the fight against climate change is a reality that nobody questions, and it is the financial industry itself that is taking a step forward in its collaborative work to support new production models by channelling aid and promoting public-private collaboration. Banking institutions can play an important role on the road towards a just and equitable climate transition. In this context, banking associations and banks have for years been developing various commitments 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 main Spanish banks and savings banks, including CECA and its member entities, presented a joint commitment to reduce the carbon footprint in their credit portfolios, in a way that can be measured with internationally approved criteria and in line with the goals of the Paris Agreement. In doing so, the entities were already aligning themselves with the "Collective Commitment to Climate Action" promoted by UNEP FI. Furthermore, in January of the same year, CECA ratified its adhesion to the UNEP FI Principles for Responsible Banking with the goal of contributing to achieving a sustainable future. The Principles for Responsible Banking constitute the most important framework for sustainable finance worldwide.
The document How to align with the Paris Agreement – A Resource Note for Banking Associations and Banks provides new information to make it easier for banks and banking associations to align their climate commitments with the Paris Agreement by formulating joint objectives through commitments and opportunities for collaboration.