Mexico’s Central Bank, UNEP and UNDP call on Financial Sector to plan for Environmental Risks

The Central Bank of Mexico (Banco de México), the UN Environment Programme (UNEP) and the United Nations Development Programme (UNDP) call on the Mexican financial sector to frame and implement an agenda on environmental risk.

Mexico City, 19 May 2020 – Today, Banco de México and the United Nations Environment Programme (UNEP), with the support of the United Nations Development Programme (UNDP), presented the report “Climate and environmental risks and opportunities in Mexico’s financial system: From diagnosis to action,” which calls upon Mexican financial institutions to make a collective effort to incorporate environmental issues into their risk assessment and corporate governance strategies, as well as to take advantage of the opportunities that would result from the transition to a low-carbon economy.

The report highlights that climate change and environmental degradation are critical challenges of our time, as they lead to loss of natural capital, ecosystem degradation, lower productivity, and a reduction of the population’s well-being, at both the national and global level.

As part of the Network for Greening the Financial System (NGFS), the central banks along with other financial authorities have become more involved in initiatives geared towards encouraging financial institutions to accurately acknowledge and assess the impact of environmental risks, in view that such phenomena can have significant consequences on credit risk, financial stability, and social development.

This publication is a first in-depth diagnosis of the current degree of readiness of Mexican financial institutions to assess climate, environmental, and social risks. The results are based on a survey conducted on the senior management of over 60 institutions and consider nearly 90% of the credit portfolio of the banking system, 80% of the assets reported by fund managers to Mexico’s National Securities and Banking Commission (CNBV), 90% of the assets managed by the Retirement Funds Administrators (AFORES), and 44% of the assets reported by insurance companies.

When talking about this initiative the Governor of Banco de México, Alejandro Díaz de León, highlighted the importance of collective action of all the actors of the financial system. He also expressed his confidence that the report will serve as the basis for the development and implementation of standardized methodologies and criteria in the evaluation of environmental and social risks, which are essential for long-term prosperity.

“It is clear that we need to manage risk far better than we currently do, and this becomes more vital in the context of climate change which remains the existential challenge facing humanity. Financial institutions that sufficiently factor in climate risk, will be able to ensure the long-term sustainability of their portfolios. This study offers useful recommendations for financial institutions and regulators in preparing for the future,” said Inger Andersen, Executive Director of UNEP.

According to the report, although Mexican financial institutions have become more aware of climate risks, they are still required to integrate more systematic and standardized measures, implement the international agenda, and develop methodologies and areas of responsibility within their own corporate governance structures. In this regard, it draws upon implementing specific actions to mitigate environmental risks and increase green financing flows to the Mexican economy, such as:

  • Defining a national taxonomy for green and sustainable activities,
    setting clear timelines and corporate governance commitments by financial system actors to improve and monitor climate risk management,
  • Designing the incentives to incorporate environmental-related factors to firms’ strategic planning, and
    developing voluntary reporting standards for Mexican firms.
  • “Climate change and environmental degradation are critical challenges of our time, and the financial sector has a key role to play in tackling these issues. The recommendations of this report – such as clear timelines and commitments at the board level to incorporate social and environmental aspects into major plans of action, risk management policies, annual budgets, and business plans – will hopefully resonate with decision makers at the highest levels of the Mexican financial sector,” said Achim Steiner, Administrator, UNDP.

New paper on how Covid-19 affects Sustainable Finance

New York/Geneva, 7 May 2020 – New York/Geneva, 7 May 2020 – Today the International Network of Financial Centres for Sustainability (FC4S) launched a working paper on the implications of the COVID-19 pandemic on sustainable finance. The paper supports thinking on how to respond to the pandemic from a sustainable finance perspective. Specifically, it has two objectives.

The first is to set out what we know about the ways in which the many different components of our sustainable financial system – market actors, policymakers, regulators, and international institutions – are thinking, planning and reacting to the pandemic, with a focus on implications for sustainable finance markets.

The second objective is to set out a framework for assessing what levers may exist to strengthen the role of the financial system in supporting a low-carbon recovery, and the prospective roles for different communities of actors.

Importantly, the paper it is a work in progress and will be updated and refined every quarter as new information and new ideas come to our attention. This allows us to continuously gather information and insights to refine our analysis as we try to be as fluid as the global response to the pandemic is.

The working paper looks at four major sections: Financial and Capital Markets; Policy Action; Regulation and Supervision; and International Networks covering recent developments in response to COVID-19.

“If there is one thing that COVID-19 has emphasized, it is that natural capital underpins our economies. The health of people and the planet are one and the same. The 90% decline in green bond issuance is a matter of concern. If we aim to rebuild more green and resilient economies, we need to maintain healthy debt ratios and encourage all debt to be aligned with the Sustainable Development Goals,” said Marcos Mancini, Head of International Partnerships, UNEP Inquiry.

Some takeaways from the report include:

  • Pipelines of new greenfield low-carbon projects (e.g. renewable energy) are likely to be significantly reduced for the foreseeable future, both in developed and emerging markets.
  • Capital raising to fund the stimulus will need to take many forms – and green securities could play a major role.
  • Financial supervisors are likely to strengthen focus on long-term risks with exponential characteristics – potentially leading to a more granular assessment of climate risks.

New FC4S Report identifies Sustainable Finance catalysts to fund the 2030 agenda

New York, 29 April 2020 –The International Network of Financial Centres for Sustainability’s (FC4S) latest report maps out and analyses the complex array of relationships of sustainable finance partnerships while highlighting how the sustainable finance ecosystem can better work together to achieve the global development goals of the next decade. The report, which is the result of a collaboration between the United Nations Environment Programme (UNEP) Inquiry, FC4S and the United Nations Development Programme Finance Sector Hub (UNDP FSH) does so by identifying exactly how these networks function and the interplay between the different initiatives.

“To achieve the ambitious 2030 Agenda we will need trillions to finance it first. This report makes the case for sustainable finance to play a major role in fulfilling that agenda, and it does so by mapping and analysing the intricate relationships of sustainable finance partnerships, be they networks, pledges, coalitions, platforms or principles, to determine exactly how these networks function,” said Stephen Nolan, Managing Director, FC4S.

‘Nudging the Financial System: A network analysis approach’, focuses on efforts currently undertaken by individual countries, regional groups, multilateral development banks (MDBs), international organizations (IOs), private sector entities, and non-governmental organizations (NGOs). The current global sustainable finance network is composed of 115 different “partnerships,” 5,181 constituent members and more than 10,000 connections. Based on network analytics, the report shows that 75% of network participants is connected to only one partnership and only 13% of the network participants is connected to three or more other partnerships. This shows that the core of the sustainable finance agenda is mainly driven by a small number of network constituents, including financial institutions, regulators and MDBs.

“Recent events have emphasized the interdependence of our economic and financial systems with nature. They showed that the decade ahead needs to be a decade of acceleration, one that drives transformative action and where the multilateral system converges to present a united front. This is no different for the sustainable finance agenda and the financial regulators and market players driving the agenda in this space,” said Marcos Mancini, Head of International Partnerships, UNEP Inquiry.

“While the work initiated by the different partnerships mapped out in this report has certainly contributed to an acceleration in the number of green finance actions and policy and regulatory measures issued, rethinking and transforming our financial system to safeguard our commons and realize opportunities for all will require to pursue a collective action agenda within the sustainable finance ecosystem,” said Marcos Neto, Director, UNDP FSH.

An increasing number of partnerships at the international, national and market-based levels have driven the overall transition towards a sustainable financial system capable of delivering a sustainable real economy. The growth of sustainable finance partnerships at these three levels between 1990 and 2019 displays an exponential trend, with a significant acceleration in the number of initiatives established from around 2009 onwards. During the first two decades, initiatives were established at a rate of approximately 1 per year, but for the 2009-2019 period, this rate increased to 7.4 per year.

This exponential growth in sustainable finance initiatives highlights the mainstreaming of the sustainable finance agenda, but problems still remain. Many financial institutions have expressed confusion about the abundance of partnerships, which in turn could be a barrier to catalyse mass adoption.

The report also highlights that, on average, both banks and asset managers were involved in more than 10 initiatives, making them more central to the network than insurance providers and asset owners. Despite having similar means, the top 20 asset managers and banks exhibit a wide deviation in the number of initiatives they are involved with. Banks have the largest spread (between 0 and 43) indicating that, while there are a few leaders frequently involved in most of the activities in the sustainable finance space, there are also some institutions with a rather nascent sustainability agenda.

One of the major conclusions to come out of the report is that given the growth in network partnerships an effort by members of a sustainable finance network to increase and broaden the coordination of their activities can help the network develop, as well as express and sustain a more coherent structure at a higher level. This would allow for increased efficiency in system-wide outcomes and help to green the financial system and mainstream sustainable finance as one the pillars to achieving the 2030 agenda.

FC4S plans huge growth in Sustainable Finance and launches Regional Programme for Africa

Geneva, 10 October, 2019 –Maintaining the momentum of the Secretary-General’s Climate Summit last month, a global network of 30 financial centres – accounting for $61.3 trillion in equity market capitalization and representing 80 percent of global equity markets – today agreed to mainstream green and sustainable finance both locally and internationally, also agreeing to set common targets by the end of 2022.

In just over two years, the UN Environment Programme (UNEP)-convened International Network of Financial Centres for Sustainability (FC4S) has grown from a small movement into one that includes major financial centres from across the world.

These centres met in Geneva to set out a new strategy aiming to align their investments with the Paris Agreement and the Sustainable Development Goals – both of which need a major boost in funding to achieve their objectives.

At the meeting, the centres agreed to throw their full weight behind green and sustainable finance, to strengthen public-private collaboration on sustainable finance and to support coherence across markets in response to policy and regulatory developments.   Why isn’t this wording included in the events section?

They aim to agree on key, measurable common targets by the end of 2022; this consultative process will be complete by late 2019 or early 2020.

The FC4S also launched a regional work plan for Africa – the continent where sustainable finance needs are the highest, but flows of finance are lowest.

The programme will work with the five African member centres – Abdijan, Cairo, Casablanca, Lagos and Nairobi – to encourage strategic action, collaborate with peers across the continent, and facilitate engagement with major international hubs.

“The recent Climate Action Summit added new momentum to the global push for sustainability,” said Ligia Noronha, Director of UNEP’s Economy Division. “But action on climate and other environmental challenges needs financial backing. The FC4S and its members can be a major driving force for positive change by directing finance to investments that shore up our planet’s ability to support human development rather than undermine it.”

While green and sustainable finance is growing, the levels dedicated to delivering on the Paris Agreement and the Sustainable Development Goals are still insufficient. The World Resources Institute estimates that USD 5.7 trillion will need to be invested annually in green infrastructure alone by 2020. However, 2018 research by the United Nations Framework Convention on Climate Change found that climate finance had hit only USD 681 billion annually by 2016. Private sector investment is crucial to make up the shortfall.

FC4S works with the financial centres to close this gap by promoting strategic action on green and sustainable finance, expanding the pipeline of green assets and products, and helping policymakers build positive conditions for green and sustainable finance.

Financial centres generate a powerful clustering effect by concentrating a number of interlocking financial activities – banking, capital markets, investing, insurance, professional services, as well as policy and regulation. As sustainable finance accelerates across the world’s capital markets, FC4S members have recognized the strategic opportunity of their roles in this evolving space.

“The FC4S network has now reached a critical mass, and is primed to play an important role in the global sustainable finance agenda,” said Stephen Nolan, head of FC4S. “Each of our members now has the chance to build a strong, profitable future for themselves while doing what is right for people and planet.”

Martin Spolc, the European Commission’s Directorate-General for Financial Stability, Financial Services and Capital Markets Union (FISMA), and Morgan Despres, of the Network for Greening the Financial System (NGFS), also lent their expertise to the sessions and presented the current state of play of their work.

NOTES TO EDITORS
About the UN Environment Programme (UNEP)

UNEP is the leading global voice on the environment. It provides leadership and encourages partnership in caring for the environment by inspiring, informing, and enabling nations and peoples to improve their quality of life without compromising that of future generations.

About the FC4S Network

The FC4S is a partnership between leading financial centres and the United Nations Environment Programme, which acts as its Convenor and Secretariat. The objective of the Network is to enable financial centres to exchange experience, drive convergence, and take action on shared priorities to accelerate the expansion of green and sustainable finance.

Mexico’s Green Finance Advisory Board joins FC4S

Mexico City, 31 July 2019 –Mexico’s Green Finance Advisory Board (CCFV) today joined the International Network of Financial Centres for Sustainability (FC4S) as it looks to help turn the Latin American nation into a regional green finance powerhouse.
The CCFV is the 28th member of the UN Environment Programme-convened movement to put private capital behind green investments. FC4S already boasts some of the world’s major financial centres as members.

“We are excited to have the opportunity to be part of the FC4S, and to work alongside them to reach our common goal to become a greener and more transparent financial system,” said Luis Sebastián Sayeg Seade, co-President of the CCFV and head of pension fund Afore Banamex.

“We are enthusiastic to become greener, because we know greener means challenging the status quo, while following global standards to improve every day. This benefits investors, the financial sector and, most importantly, local economies, the environment and the Mexican population.”

The advisory board, representing over 300 members, was created in 2016 in response to the growing need in Mexico to develop a sustainable financial market with an authentic long-term vision. The CCFV is particularly concerned about Mexico’s vulnerability to the impacts of climate change. Located between two oceans, it is exposed to storms and sea-level rise. The CCFV says 71 per cent of the country’s economy is vulnerable to climate-related disasters.

“The CCFV has brought together leaders that represent the financial system in order to share learning on how we can take action to manage and minimize climate and social risks,” said Enrique Ernesto Solórzano Palacio, co-President of the CCFV and pension fund manager Afore Sura CEO.

“We must work harder on taxonomies, improve data disclosure and the identification of sustainable and green infrastructure pipeline, and exercise pressure for the decarbonization of the companies that come to public markets to obtain funding.”

Beijing, Cairo, Lagos, Madrid and Tokyo have all recently joined FC4S in a surge of support for sustainable finance in line with growing global awareness of the urgent environmental challenges the planet faces.

The addition of the CCFV is particularly significant, given the size of the country’s economy. Mexico is currently ranked as the 15th largest world economy in terms of GDP, and 11th in terms of its purchasing power.
Since the Mexican Congress in 2012 approved the Climate Change General Law, green finance has been growing in Mexico. In 2015, national development bank NAFIN issued its first green bond – the first certified green bond in Latin America.

In 2016, with the formation of the CCFV, the pace picked up as the CCFV developed a green finance agenda – incorporating the financial system´s associations, development and multilateral banks, investment bankers, asset managers, rating agencies, and non-governmental organizations.

In 2017, Mexico City placed its first green bond, becoming the first Latin American City to obtain financing through this instrument. There have been other important advances and key signals to the market around green finance. For example, the National Commission of the Savings System for Retirement, the regulatory body of the Retirement Funds, encouraged the integration of ESG (Environmental, Social and Governance) concerns in investment decision-making. By December 2018, 51 institutional investors – who jointly manage USD 237 billion in assets, declared themselves in favor of the disclosure of ESG information in cooperation with the CCFV.

Less than a year after Mexico City’s first green bond, the Central Banks and Supervisors Network for Greening the Financial System (NGFS) was launched. This network is steered by Banco de Mexico, the Bank of England, the Banque de France and Autorité de Contrôle Prudentiel et de Résolution (ACPR), the Nederlandsche Bank, the Deutsche Bundesbank, Finansinspektionen (The Swedish FSA), the Monetary Authority of Singapore, the People’s Bank of China and Banco de España and has 42 members along with 8 observers.

“We are delighted to have the CCFV join our network,” said Stephen Nolan, head of FC4S. “They have already done stellar work promoting green and sustainable finance in Mexico. We hope to help them advance the agenda further in the region, while also learning from the many valuable steps they have taken to green Mexico’s financial system.”

Madrid latest in flood of cities joining FC4S

Madrid, 23 July 2019 –Madrid today officially joined the International Network of Financial Centers for Sustainability (FC4S), bringing to 27 the number of financial centers joining the UN Environment Program-convened movement to put private capital behind green investments.

“With our entry to FC4S, our center is joining a thriving international sustainable finance movement, undertaken by the world’s large corporations in compliance with the Paris Agreement,” said José María Roldán, President of the Spanish Banking Association. “We want to learn from the experiences developed in other countries and implement joint initiatives that can help companies comply with climate imperatives, be more aware of the importance of respecting the environment and support the need for a fairer and more sustainable economy.”

“This announcement shows the commitment of the Spanish credit institutions with sustainable finance. Our main aim will be taking common action on shared priorities to accelerate the expansion of sustainability and an ASG culture throughout Spanish economy ”, expressed José Maria Mendez, General Manager of the Spanish Savings and Retail Banks Association (CECA).

Madrid’s stock market capitalization is about half of the country’s GDP, demonstrating the might it can bring to bear on sustainability. According to the Green Bond Market in Europe report from 2018, Madrid’s cumulative green bond issuance from 2014 to the first quarter of 2018 was EUR 9.8 billion. Over half of this volume came in 2017 alone.
Madrid is the ninth ranked financial center in the EU, according to the Global Financial Center Index, but in 2018 it improved its position – posting the second-highest rise in Europe and the sixth highest in the world.

The Spanish city will be represented by the Center for Responsible and Sustainable Finance in Spain (FINRESP) – a joint initiative of the main associations of the Spanish financial sector: banks, insurance companies and investment funds. FINRESP’s main goal is to promote the necessary financing to achieve the sustainable development of the Spanish economy, with a special focus on SMEs.

“On behalf of the Spanish insurance industry, I would like to welcome the decision of FINRESP to join FC4S,” said Pilar González de Frutos, President of the Spanish Association of Insurers and Reinsurers (UNESPA). “We consider it an excellent opportunity for the insurance business to contribute to facing the risks and opportunities associated with environmental, social and governance issues.”

Moreover Angel Martínez-Aldama, President of the Spanish Investment Funds and Pension Funds Association remarks that “sustainable finance is a driver not only for the asset management industry, but for the financial community. We need to trigger this trend.”

Beijing, Cairo, Lagos and Tokyo have all recently joined FC4S in a surge of support for sustainable finance in line with growing global awareness of the urgent environmental challenges the planet faces.

“Major Spanish banks and the Spanish Banking Association have already pledged their support for the Principles of Responsible Banking, but this move to join FC4S demonstrates even stronger will to back the transition to a green economy,” said Stephen Nolan, head of FC4S. “I am hugely encouraged by the groundswell of global support for sustainability we are seeing from the private sector this year, and believe that we are on the verge of something truly transformational.”

Momentum for Sustainable Finance grows as Cairo joins FC4S

Cairo, 27 June 2019 –Cairo today became the latest member to join the International Network of Financial Centers for Sustainability (FC4S), a UN Environment Program-convened movement of financial centers committed to ensuring that sufficient private capital is directed at climate-friendly and green investments.

Cairo is the 26th member of FC4S and the fourth major new financial center to join in the last month, following Beijing, Lagos and Tokyo in a surge of support for sustainable finance.

“Similar to other countries across the globe, climate change has direct and indirect economic, social and environmental risks to Egypt’s path to development and can be a threat to current efforts of economic reform,” said Mohammed Omran, Chair of Egypt’s Financial Regulatory Authority, the single regulator that has oversight on non-bank financial services such as the nation’s stock exchange and capital market activities, insurance and private pension funds, mortgage, leasing, factoring and micro finance.

“It is therefore in the best interests of all Egyptian stakeholders – policy makers and investors alike – to invest in a low-carbon and sustainable future,” he added. “Cairo’s entry into the ranks of financial centers is an important step in ensuring a sustainable future for our country and in contributing to a gradual transition of our economy to a green and circular model.”

The city is the key financial center in Egypt and regionally. The Egyptian stock exchange has long been a pioneer in sustainable finance, while Finance Minister Mohamed Maait earlier this year told Bloomberg that up to USD 500 million worth of green bonds – a first for the country – are in the works. Cairo is the second FC4S member from the Arab-speaking world, after Abu Dhabi, and the fourth member on the African continent.

“I am very excited to welcome Cairo to the FC4S fold,” said Stephen Nolan, Managing Director of FC4S. “We need to unlock trillions of dollars to finance the fundamental shift the world needs, and the inclusion of this iconic city adds welcome momentum to this quest.”

While green and sustainable finance is growing, the levels dedicated to delivering on the Paris Agreement and the Sustainable Development Goals are still insufficient. For example, the World Resources Institute estimates that USD 5.7 trillion will need to be invested annually in green infrastructure by 2020. However, 2018 research by the United Nations Framework Convention on Climate Change found that climate finance had hit only USD 681 billion annually by 2016 Private sector investment is crucial to make up the shortfall.

“In the past month, we have seen two major African cities and two major Asian cities commit to greening their financial centers,” said Satya S. Tripathi, UN Assistant Secretary-General and Secretary of the UN Environment Management Group. “This is testament to the growing willingness of the private sector to shift their focus to tackling issues such as runaway climate change, biodiversity loss and planetary scale pollution.”

Beijing joins rapidly growing movement of Financial Centers for Sustainability

Beijing, 05 June 2019 –Beijing today became a member of the UN Environment Program-convened Financial Centers for Sustainability (FC4S) Network, a rapidly growing movement of financial centers committed to putting private capital behind climate friendly and green investments.

Beijing is the 25th member of FC4S, following hot on the heels of Lagos and Tokyo, both of which joined in the last few weeks.

“We are thrilled to announce that Beijing has joined the FC4S,” said Ma Jun, President of Beijing Green Finance Association (BGFA). “As the political, economic, and cultural center of China, Beijing has the advantage of direct policy support, robust financial resources, and strong human capital to support the expansion of green and sustainable financial markets.

The BGFA is seeking to position Beijing as an international green finance center. The city is planning to launch a number of critical initiatives, including the establishment of the Beijing Green Development Fund, China-UK Green Technology Innovation Fund, and a Green Assets Exchange.

“I am delighted to welcome Beijing to the FC4S family as our 26th member,” said Kong Wei, co-chair of the FC4S and Convenor of the Lujiazui Financial City Green Finance Committee in Shanghai. “With significant capital required over the coming years to finance Asia’s transition to a low-carbon economic region, Beijing’s recognition of the importance of the green and sustainable finance agenda is to be welcomed. I look forward to working with our latest member to support their efforts.”

Beijing’s admission brings the FC4S Network to six members in Asia, with Hong Kong, Seoul, Shanghai, Shenzhen and Tokyo already on board. FC4S is developing a dedicated strategy for sustainable finance in Asia under its FC4S Asia and Pacific platform.

“By joining the FC4S Network, Beijing hopes to actively participate in knowledge exchange with our international counterparts and contribute valuable experiences and drive innovation on policies, product development, and harmonization of standards, with the vision to build a more sustainable financial system globally,” said Ma Jun.

Beijing joined the network on World Environment Day, which this year is themed around the fight against air pollution. The Beijing air pollution crisis in 2013, which led the city and the government to launch series efforts to improve air quality and protect the human health, helped to spark the growth of green finance as a way to deal with environmental issues.

“It is fitting that Beijing has joined FC4S on World Environment Day,” said Satya S. Tripathi, UN Assistant Secretary-General and Secretary of the UN Environment Management Group. “Investments that move away from fossil fuels and other polluting industries, towards green and sustainable ones, are crucial to help address the global challenge of air pollution. Beijing will be a significant player in this space in the years to come. ”

Tokyo joins FC4S network

Tokyo, 04 June 2019 –The Tokyo Metropolitan Government (TMG), the municipal government authority of one of the world’s largest urban areas, has officially joined the UN Environment Program convened Financial Centers for Sustainability (FC4S) Network as its 24th member.

As one of the world’s largest financial centers Tokyo hosts most major international banks, insurers, and the world’s largest institutional investor, the $ 1.5 trillion Government Pension Investment Fund. Over the past two years, the TMG has implemented a strategic process to strengthen its international financial center – and now, it is seeking to make sustainable finance a key pillar of its competitiveness.

Tokyo’s admission to the rapidly growing FC4S Network is the latest in a series of major announcements on sustainable finance in Japan over recent months. On May 27th, the Japan TCFD Consortium was launched by Japan’s Ministry of Economy, Trade and Industry (METI), Ministry of Environment (MOE), and Financial Services Agency (JFSA). JFSA is a member of the Sustainable Insurance Forum, the leadership group of insurance regulators collaborating on sustainability risks, as well as a member of Central Bank and Supervisors Network for Greening the Financial System (NGFS).

Tokyo’s admission brings the FC4S Network to 5 members in Asia, including Hong Kong, Seoul, Shanghai and Shenzhen. Building on recent efforts, FC4S will now begin the process of developing a dedicated strategy for sustainable finance in Asia, responding to the plans and needs of member financial centers in the region under its FC4S Asia and Pacific platform.

The announcement was made by the Governor of Tokyo, Yuriko Koike at the Tokyo Dialogue on Sustainable Finance event convened by the Japan Climate Initiative and UNEP FI in Tokyo (3rdJune).

Governor Koike said, “As a leading regional and global financial center, Tokyo is mindful of the importance of the sustainable finance agenda. Not least to finance Japan’s transition to a low-carbon economy and put Japanese capital to work supporting the low-carbon transition of our region and further afield. That is why I am pleased to announce our membership of the UN Environment Program convened Financial Centers for Sustainability network. We look forward to working with like-minded financial centers to accelerate the further mainstreaming of sustainable finance activities, at home and abroad. ”

Welcoming the announcement, Satya S. Tripathi, UN Assistant Secretary-General and Secretary of the UN Environment Management Group said, “We are delighted to welcome Tokyo to the FC4S family. TMG has annually issued 20 Billion Yen since 2017 in green bonds and by doing so have already shown their commitment to sustainable finance. This commitment has only been further strengthened by their joining FC4S and we are proud to partner with them. ”

Stephen Nolan, Managing Director, FC4S said, “With Tokyo on board, FC4S continues to strengthen its engagement in Asia. As both a regional and global financial center powerhouse we look forward to working closely with Tokyo on this important agenda. I thank Governor Koike for her leadership. ”

Lagos throws Financial might behind Sustainable Finance network

Lagos, 29 May 2019 –The city of Lagos today joined Financial Centres for Sustainability (FC4S), a UN Environment Programme-convened international network that seeks to shift private capital to climate friendly and green investments.

Lagos is the third African city to join the network, after Casablanca and Nairobi, and is the first in West Africa. The megacity’s stock exchanges have over 860 listed securities, valued at more than USD 360 billion.

“Huge flows of private capital are needed to deliver the green and sustainable finance needed to implement the Paris Agreement and sustainable development goals,” said Pierre Ducret, Co-chair of FC4S. “Lagos’ inclusion in the FC4S network is a major boost to these efforts.”

FC4S has grown into a global group of 24 leading financial hubs since its creation in 2017. Structured as a partnership between international financial centres and the UN Environment Programme, other members include Abu Dhabi, London and Hong Kong.

The network is in the process of setting up FC4S Africa – its third regional platform, following the launch of Asian and European platforms in 2018. FC4S Africa will provide advisory services for financial centres on sustainable finance strategies, technical assistance and outreach.

“The adverse effects of climate change globally cannot be overemphasized,” said Mr. Babajide Sanwo-Olu, Executive Governor, Lagos State. “I am confident that the establishment of the Lagos Financial Centre for Sustainability will contribute significantly to Lagos State’s push to attract sustainable private capital that will complement public resources to address infrastructure and social challenges and enhance climate change mitigation.

“We support this initiative and congratulate FMDQ OTC Securities Exchange and the UN Environment Programme for championing this innovative private sector-led solution.”

The UN Environment Programme assisted Nigeria with the design and launch of a sovereign green bond in 2018, only the third such sovereign bond ever launched and the first in a developing country. This led to the UN Environment Programme working with the financial community in helping Nigeria draw up a Sustainable Finance Roadmap for Nigeria.

“Lagos joining the FC4S opens up new possibilities for Nigeria and countries in West Africa to leverage sustainable finance for social and climate impact,” said Satya S. Tripathi, UN Assistant Secretary-General and Secretary of the UN Environment Management Group. “We welcome Lagos into the fold and look forward to doing great things together.”