Sustainable Finance
Sustainable finance refers to the consideration of sustainability issues by private and public actors. Sustainable finance is thus a cross cutting issue of different policy areas, including budgetary, financial, industrial, and economic policies, as well as sustainability, nature conservation, and climate mitigation policies.
The world needs to respond to the emergencies of climate change and the extinction of species. This entails a comprehensive socio-ecological restructuring to achieve greenhouse gas neutrality and a sustainable economy. Sustainable Finance has a key role to play in this transformation.
The transformation will fundamentally change economic structures and their production and consumption patterns. The financial system leverages change as a provider of capital for the real economy. For example, it provides companies with financial capital in a relatively easy and cheap manner. Sustainable Finance requires sustainability definitions and transparency regulations in line with systematic scientific standards. Sustainable Finance activities at Germanwatch promote these concerns with a focus on German, European, and international Sustainable Finance strategies. Germanwatch as a civil society organisation working on environmental and development issues contributes to the political and economic processes necessary for transformation.
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Aktuelles zum Thema "Sustainable Finance"
On 23 November, the 29th UN Climate Conference came to a close in Baku. In this blog article, our Germanwatch experts report on the difficult negotiations, detail the most important decisions, and draw conclusions on the climate conference in times of crisis.
How can we ensure that financial commitments lead to transformative, measurable outcomes? This question comes into focus as the global community charts a path toward the New Collective Quantified Goal for climate finance beyond 2025. Our CFAS policy brief identifies these gaps and explores ways to improve impact measurement, including recommendations for COP29 to incorporate robust, transparent methodologies into the NCQG.
The path towards a fair and effective New Collective Quantified Goal (NCQG) for climate finance has been fraught with intense global debate: Who should contribute, and how should contributions be assessed, particularly government funding? These questions have brought to the fore principles of equity and the notion of ‘common but differentiated responsibilities and respective capabilities’ – core tenets of climate justice. With the stakes high, the NCQG’s structure will shape international climate finance and our collective response to the escalating climate crisis.l
In 2023, six multilateral development banks have reached their self-imposed deadlines for the alignment of their projects with the Paris Agreement. We have analysed 60 of their projects and present the somewhat sobering findings in our blog post – with recommendations for greater transparency.
Developing countries face an increase in financial needs to continue progressing on the SDGs, including on climate. The reform of the international financial architecture (IFA) has gained momentum over the past years in response to these growing needs as well as a shift towards an increasingly multipolar world. The surge in momentum has coincided with the negotiations on the New Collective Quantified Goal on Climate Finance (NCQG). In two policy briefs, we analyse how the IFA reform agenda and the NCQG are interlinked in their objectives and goals.
The emerging polycrisis is challenging governments and institutions around the world. Especially countries in the Global South lack the financial capacity to address the current challenges and simultaneously prepare their nations for the impacts of climate change. The existing international financial architecture has so far been unable to provide the necessary financial resources.There are three major reform proposals that address different institutions within the international financial architecture. This primer introduces the proposals presented and provides an overview of the main institutions and actors involved in the process in Germany.
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