R.A.C.E 2022 Closing Remarks

foreign [Music] pleasure to join you today on behalf of the Glasgow Financial Alliance for net zero or gfans it's a pleasure to be here at least virtually at the Abu Dhabi Finance week and I'd like to begin by congratulating the Abu Dhabi Global Market for its continued leadership on sustainable Finance as you know the launch of the UAE sustainable Finance working group three years ago now has played a crucial role in advancing The uae's Net Zero by 2050 ambition and the Abu Dhabi sustainable Finance declaration has framed the collaboration between the private sector financial institutions the ministry of climate change and environment and the Central Bank of the UAE on Innovative Green Financial products that are helping to drive down emissions and even though we're meeting today still in the midst of call 27 it's not too early to look ahead to cop 28. we all know with climate time is indeed of the essence and in this respect the world is fortunate that the UAE will host next year's call I expected to accelerate momentum in the fight against climate change particularly by helping to develop more comprehensive and granular and ultimately much more effective approach to the energy transition of course finance will play a critical role in this respect and in many respects last year at comp 26 it was about making Net Zero commitments in finance this year it's been about operationalizing those commitments through transition planning next year it'll be about implementation and action and building tracking and building progress you know at present G fence is over 550 institutions from over 50 countries and all of those financial institutions are now committed to supporting the transition consistent with limiting temperature increases to one and a half degrees and those are the emissions a lot of their just of their own operations although those are included but of their clients and the people they lend to their so-called financed emissions those g-fans members are making significant progress nearly 40 percent of the 42 trillion dollars of assets managed by those members of The Net Zero asset managers whose commitments are due by now they have been made and those assets are being managed in uh consistent with uh Net Zero by 2050. all of the 160 founding members of g-fans who were required to set interim targets by today at call 27 well we needed 160 but we now have over 250 science-based interim targets produced and 90 additional targets that are expected to be approved by the end of cop 27. so in other words all Targets on or ahead of schedule of the timelines when members join Chief ends it's also easy to forget that at the start of last year there wasn't a single Bank in the world that had a science-based 20 30 Target that included their financed emissions to meet today almost 60 banks have already done so this substantial progress is a clear sign that the hard work of commit implementing those commitments made in Glasgow is well underway but to help financial institutions move forward g-fans has developed guidance on Net Zero transition planning both for financial institutions and for the companies they serve the key couple key points on the transition planning framework the first is that it identifies four strategies for transition Finance the first is to support climate Solutions in other words the Technologies and products that will enable enable the economy to decarbonize and the second strategy is to finance business models that are already aligned with the science-based pathway to achieve Net Zero now there's many who would stop at these first two but crucially the G fans framework makes clear that transition Finance is about driving decarbonization in the real economy not retreating to the false comfort of financial portfolio decarbonization we know the world can't divest its way to Net Zero we have to invest and grow and that requires the third strategy of going where the emissions are and backing those companies with credible transition plans to converge with a science-based decarbonization pathway and finally climate transition means backing the managed phase out of those High emission assets that will need to be stranded in the transition to help financial institutions determine which companies to back and which to avoid G fans has developed common expectations for the transition plans of companies in the real economy and has developed also high level guidance on how financial institutions can use sectoral Pathways to assess company ambition with what I just described the G fans transition plan framework and supplemental guidance financial institutions now have the tools they need to act on their Net Zero commitments as a Next Step Finance needs to grow transition assets across these four strategies and in order to judge that this needs transparency and accountability and that's why all of our work from our Global and Net Zero transition planning Frameworks to our regional tools and guidance will be underpinned by a new net zero data public utility that we will launch during the UAE call once operational by this time next year buy your cop the data utility will provide consistent accurate and openly available climate transition related information that will allow not just financial institutions but Regulators civil society and the general public to track climate progress it will provide accurate trusted and verifiable climate transition data including financed emissions targets and performance against those targets and that data will be openly available in a single place for the first time so our Focus next year for your cop 28 will be to amplify and encourage the uptake of net Zero's transitions plans and to have the accountability and transparency through the data utility we'll work with key sectors particularly in oil and gas to develop pragmatic and impactful sectoral transition models that way by the time we convene in Abu Dhabi next November we'll be on track we'll be able to track rather the performance of financial institutions as they deploy Capital to transition opportunities and then by comparing a financial institution with its peer a bank with a bank in its region for example stakeholders will be able to assess the extent to which any gaps that exist and there always will be gaps whether those gaps are due the institution itself or something more General the product of broader factors such as inadequate country climate policies or enabling environments so climate laggards can be called out strong performance reward performers rewarded and better country policies including in the energy transition will be encouraged suggests that this should be one of our core goals for cop28 driving the accountability as implementation takes place and encouraging better policy pragmatic policy in the energy transition and the adgm sustainable Finance platform plays a strong foundation for this centralizing data on sustainable Finance growth and trends and we look forward to building on this work in the year ahead to ensure that Finance does what it should which is effectively catalyzed and enables what governments come and companies ultimately are citizens initiate thank you very much