How do we build a low carbon economy that is resilient to climate change? Positioned at the heart of this issue, the financial sector is making a commitment to align its activities with a global warming trajectory of less than 2°C, which means achieving net-zero emissions by 2050, consistent with the targets of the Paris Agreement.
Understanding the impact of financial-sector initiatives on the real economy
The Sustainable Finance Observatory seeks to enhance understanding, tracking and evaluation of the financial sector's gradual transformation by observers and stakeholders. The Paris Financial Centre is determined for this project to serve as a model of transparency, and the European Finance Climact project intends to promote similar initiatives in other European and international financial centres.
July 2019, a step forward for sustainable and green finance
During the Financial Centre event held on 2 July 2019 in the presence of Bruno Le Maire, France's Minister of the Economy and Finance, the primary professional bodies and federations representing the Paris Financial Centre announced in a joint declaration that they were undertaking new commitments to support the fight against climate change and contribute to the goal of achieving carbon neutrality by 2050.
An initiative that contributes to Europe's Finance ClimAct project
Headed by ADEME and endowed with a budget of 18 million euros, the Finance ClimAct project aims to develop the new tools, methods and knowledge needed to allow savers to integrate environmental targets in their investment choices on the one hand and, on the other, enable financial institutions and their governing bodies to incorporate climate-related issues in their decision-making processes and to align financial flows with energy and climate objectives. The Sustainable Finance Observatory is supported by Finance for Tomorrow in its capacity as a founding member of the Finance ClimAct project.
For the first edition: two types of data
On the one hand, the individual public commitments of financial institutions, based on voluntary declarations by each player, and on the other hand, the aggregated sectoral data, allowing to report on the achievements and actions of the players of the Paris financial market in terms of green and sustainable finance.
- In the section "Monitoring commitments of financial actors", you will find a database of over 300 players who have voluntarily reported their commitments. This reporting was carried out with the support of the Commitment Guide, a document set up in coordination with supervisors and private financial players. Each commitment is evaluated through minimum criteria, and declared compliant or non-compliant. The Commitment Guide is available here.
Actors are also encouraged to declare the follow-up of their commitments, which you can find in one click on each commitment.
Finally, browse the reading grids to easily understand the content of the commitments of the actors via key indicators.
- In the "Transformation of financial practices and flows" section, you will find data aggregated by financial activites and representing more than 80% of French assets under management. The objective of this section is to assess the transformation of financial practices, and to observe whether it allows for the achievement of the objectives of the Paris Agreement, as well as, more broadly, the Sustainable Development Goals (SDGs). In this perspective, finance must divest from high emitting activities, invest in sustainable activities, manage its funds responsibly and offer sustainable products to their clients.