55 nations participate: Investors have appetite: Emerging markets: Resilient infrastructure: $1tn by 2020 target is real, the Green Bond Pledge is here: Markets should move faster to meet demands from green bond champions
We know that some of you couldn’t make it to our 2018 Annual Conference, here’s our high level 2-minute takeaway for you
Everyone wants more
From the opening plenary session to the last of the specialist roundtables, investors were asking for more. More quality, investable green product, more action from governments and development of country climate plans, pipeline growth and focus on emerging markets.
The message that the national development and infrastructure directions of China, India and Africa are where green investment expertise must grow and climate capital must flow reverberated throughout proceedings.
Mainstream is outpacing the market
We’ve had over 55 nations represented this year, up a healthy 20% on the 44 nations at our 2017 event. Representation came from investors, emerging markets’ organizations, financial institutions and government bodies.
This diversity of attendees was matched by the depth of discussions that included pricing, proceeds, market behaviors, aggregation and harmonization. The Green Bond Pioneer Awards also mirrored this trend with 15 countries from 6 different continents being officially recognized.
Green bonds are mainstreaming but scale and secondary markets still lag.
The $1tn by 2020 target is real
From its origins post-Paris in 2015 to Marrakesh in 2016 to the six climate leaders clarion call in Nature Magazine and a Mission 2020 milestone in mid-2017 to our 2018 conference, the target is real.
There’s now 32 months to the end of 2020, 3 more COPs and innumerable opportunities for investment decisions to be made.
Expectations are growing that more of the top 100 banks should commence green issuance, announce green lending programs and expand green underwriting.
The largest global emitters being engaged by the Climate Action 100+ coalition will also be drawn in over time as insitutional investors look for green issuance as a part of corporate balance sheets reflecting TCFD, 2 degree compliant business planning and the brown to green transition.
Christiana Figueres articulated the challenge during COP23 last November:
“A systemic response from global finance is required. Asset owners and managers need to adjust their capital allocations. Banks and corporates need to commence large scale green bond programs. Funding clean energy and green infrastructure to meet NDC goals is the objective. $1 trillion in green finance by 2020 is the performance measure.”
Which leads us neatly into……
Has your organisation signed the Green Bond Pledge?
The Green Bond Pledge is aimed directly at issuers, cities, governments and corporates with an attendant Investor Statement targeting asset owners and managers.
The Pledge builds on the seminal 2015 Paris Green Bond Statement but has garnered significant new support. Christiana Figueres has been one of the leading voices engaging with global finance since lead up to COP21. Patricia Espinoza, current UNFCCC chief has kept up the momentum, both are backing the Pledge.
Watch for more signatories as the rollout program loops from the London launch to the Global Climate Action Summit (GCAS) in September, to the UN General Secretaries Climate Summit in 2019 to COP25 in Latin America.
You know where this is going: $1trillion in green bonds by 2020, as stressed by Ms Figueres in this interview, is just the start.
Warming up to Adaptation, Resilience, SDGs, you name it….
Discussion on the role of green finance has moved apace with climate science. The leaked IPCC forecast that 1.5 degrees warming will be breached was the latest in a stream of depressing assessments on climate impacts. In contrast to earlier years where green bonds were oftened positioned as part of the mitigation response, recognition is here that adaptation and resilience factors must be embedded on a whole of government basis as well as investment in infrstructure, due diligence, design & use of proceeds.
The crossover between green bonds and progressing key SDGs and the 2030 Agenda, particularly those centered on sustainable cities, transport, energy and water also came through from various speakers. Look out for a coming blog from Climate Bonds on this very topic.
The Last Word
There’s more to come from our Conference, a host of briefing papers will be available including conference interviews on our YouTube Channel, Twitter, Facebook and Instagram. Follow them for the latest.
Meantime, a big thank you to our sponsors, media partners and participants who helped make the three days such a success.
‘Till next time,