UNEP Inquiry issues final report on financial system for sustainable development

Highlights positive role of green bonds and practical examples from around the world

Lima: Last week the UNEP Inquiry launched its final report ‘The Financial System We Need – Aligning the Financial System with Sustainable Development’.  Another exciting output of a very busy time in Lima!

For those of you not familiar with the Inquiry, the UNEP Inquiry into the Design of a Sustainable Financial System was established in 2014 to explore how to align the financial system with sustainable development, in particular environmental challenges.

Exclusive to our Blog readers: Nick Robins Lima presentation on the report

The Inquiry’s report sets out a range of different levers that can be applied to financial system to facilitate sustainable development. Green bonds are highlighted as one of those levers.

Green bonds role in sustainable financial system

The report emphasizes that policymakers aiming to expand green bond markets can draw on the 10-point agenda for governments developed in collaboration with the Climate Bonds Initiative.

The green bond action plan includes development of guidelines and standards, a pipeline of green projects, strategic public green bond issuance and investment, aggregation mechanisms such as green securitisation, credit enhancement, tax incentives, central bank action and preferential risk weighting. Collaboration is an overarching priority action.

As the central bank of Bangladesh illustrated this week by announcing they will be investing forex reserves in green bonds, these are more than theoretical action points:

The Executive Briefing for the public sector on green bonds published separately by Climate Bonds Initiative and the Inquiry a few weeks ago offers more examples and details on each of the 10 action points.

Practical examples of green bond actions around the world

Green bond actions already in play from China, India, the US and Indonesia are also detailed. Climate Bonds has been working closely with the Inquiry in several of these countries to develop country-specific green bond agendas and will advise as new milestones are reached.

Full green bond guide to be launched with Inquiry in November

The Inquiry report offers an excellent teaser for the full green bond policy guide that the Climate Bonds Initiative will publish, in collaboration with the World Bank, around COP21.

Full UNEP Report and Exec Summary (Available in 6 Languages) here.

Exclusive: Nick Robins Lima Launch Presentation here