One Planet Summit: All Green Finance Talk, But What About Action?

Home Business One Planet Summit: All Green Finance Talk, But What About Action?
One Planet Summit: All Green Finance Talk, But What About Action?

Paris, France: For a few hours early December, Paris once again became the world capital of climate talks thanks to President Emmanuel Macron’s initiative: the “One Planet Summit”. The goal of the summit (two years after the adoption of the Paris Agreement) was to bring together local, regional and national leaders, as well as public and private organizations with a focus on finance to discuss how to together they could support and accelerate the ongoing global efforts in the fight against climate change.

On a political level, the summit was the perfect occasion for the French President to consolidate France’s position as the leader and the guardian of climate change efforts at the international level (despite little coherence with national policies), especially since the US left the Paris agreement earlier this year. External stakeholders, including NGOs were expecting innovative initiatives,  concrete actions and a strong commitment to green finance.

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President Emmanuel Macron with Prime Minister Theresa May at the One Planet Summit in Paris
President Emmanuel Macron with Prime Minister Theresa May at the One Planet Summit in Paris. Credit: Flickr

So between Arnold Schwarzenegger showing up on one of Paris’s shared bikes, Bill Gates committing to help smallholders around the world and Leonardo DiCaprio listening carefully, what measures were announced to save the planet?

Here are the key takeaways from the latest gathering of the global climate ‘conscious’ community.

1. Public finance paving the way

To reduce green house gases enough to reach the objectives of the Paris Agreement, impressive investments are needed. According to the International Energy Agency, about 3.5 trillion dollars a year of energy sector investment would be required for the next 30 years to keep the temperature rise below two  degrees. Meanwhile, between January 2014 and September 2017, the global banking sector provided in excess of 600 billion dollars to the top 120 coal plant developers through finance lending and underwriting.

Coal power plant. Credit: Wikicommons

Hypocritical much? This considerable inconsistency was noticed by the World Bank who at the summit announced a pledge to quit financing oil and gas projects after 2019 unless there were “exceptional circumstances”. By doing so, the World Bank is showing leadership as the first multilateral financing organization to make such a commitment, winning praises from NGOs including Greenpeace calling it “a damning vote of no confidence on the future of the fossil fuel industry”.

The EU, on the other hand, announced a plan to support climate-friendly investments of up to $9 billion as part of its External Investment Plan but observers comment that it’s mainly an existing measure repackaged for the summit event. While, the amount is definitely significant, the announcement comes at a time when many are calling out European Institutions for weakening leadership on climate change issues. A strong financial commitment and an announcement to disengage even partially from fossil fuel projects would have reassured external stakeholders that EU leaders are taking these matters seriously. Guess it’s for the next ‘climate change summit’ then?

2. The private sector makes further commitment 

On a more positive note, the summit saw one of the biggest French multinationals, the insurance company AXA (also one of the largest insurance groups worldwide) pledging to stop every investment in companies engaged in building coal plants and removing 2.5 billion euros of investment from the sector. The giant is also disengaging €700 million from projects linked to tar sands and increasing green investment by €9 billion before 2020.

Renewable energy and green investments
Solar farm in the United States. Credit: Unsplash

Additionally, 91 French companies launched the “French Business Climate Pledge”. Together, they are committing to massive investments towards a low carbon economy including 60 billion to renewable energies, energy efficiency and other low carbon sources of energy.

Furthermore, 225 investors with more than $2.5 trillion assets launched a new initiative to engage with some of the most polluting companies worldwide on climate change. Investors will ask companies to take specific measures to accelerate climate action including accountability framework, reduction of green house gas etc.

3. Philanthropists continue to dig deep in their pockets

Meanwhile, the numerous philanthropists who attended the summit provided more hope for a sustainable future. The Bill & Melinda Gates Foundation, along with the European Commission will spend more than $600 million on research between 2018 and 2020 to better protect smallholders farmer’s against the effects of climate change. The money will be used for research on crop protection against rising temperatures, droughts and floods. The former mayor of New York, Michael Bloomberg, the coordinator of America’s Pledge, a network of American organizations still pledging their commitment to the Paris Agreement, confirmed the will of the network’s powerful members, which include Amazon, the state of New York and Berkley University, to act against climate change, despite President Trump’s decision to pull out of the accord.

Plaque of a Bill Gates quote at the Bill & Melinda Gates Foundation. Credit- Jules Antonio
Plaque of a Bill Gates quote at the Bill & Melinda Gates Foundation. Credit: Jules Antonio

4. National commitments are lacking

It’s important to note that there were zero commitments from national governments made at the summit, proving as is often the case, the lack of political willpower when it comes to the climate. A political impulse would indeed mean rethinking our models of development, production, consumption and most countries aren’t ready for this kind of change despite existing solutions and financial opportunities. That’s where gatherings like these hit their limits. Despite being necessary to bring worldwide stakeholders together to find solutions to this issue, they are often followed by little to no concrete actions at the national level where the implementation of measures would need to take place. Moreover, the lack of accountability framework and dedicated organization makes the follow up of the  announcements made, a task so complicated that NGOs are struggling to keep up with shining a light on poor performers.

Is the summit slogan “Making Our Planet Great Again” only good for press and publicity? Isn’t it time for governments to roll up their sleeves and get to work at the political level, you know take climate action and actually get stuff done?

Prime Minister Theresa May attends the One Planet Summit in Paris
British Prime Minister Theresa May attends the One Planet Summit in Paris. Credit: Flickr

Other key announcements that were made during the One Planet Summit:

  • An ambitious climate-smart zone in the Caribbean to help generate investments to support the development of greater energy and infrastructure resilience.
  • 20 companies including Unilever, Marks & Spencer and Engie are committing to phase out coal for both consumption and electricity generation
  • The OCDE launches the Paris Collaborative on Green Budgeting initiative to contribute to the development of methodologies towards greener national budgets.
  • A UN Women’s initiative which aims to boost resilience of women and youth in the Sahel through climate-smart agriculture and transform livelihoods of millions.

Engaging the financial sector is mandatory and the commitments made at the One Planet Summit are significant and innovative but unfortunately remain too weak considering the urgency of the situation. Will finance save the planet? It will definitely help but global mobilization both at the political and citizen level is still lacking to make the necessary shift towards a low carbon economy quickly enough.

Over to you: Should the private sector be pressured to transform its practices to reduce man-made emissions or should we leave it up to our politicians to legislate better climate policies? Feel free to share your thoughts below.

Title image courtesy of Flickr.

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