COP15: Carney calls on FIs to integrate nature and biodiversity in transition plans

GFANZ's co-chair highlighted the 'twin crises of nature and climate' on Finance Day in Montreal as European governments pledged support for the private sector.

Mark Carney has urged private finance to ensure net-zero transition plans include clear priorities on deforestation, protecting nature and restoring biodiversity.

The former governor of the Bank of England and co-chair of the Glasgow Financial Alliance for Net Zero (GFANZ) made the call in a speech delivered on Finance Day at COP15 in Montreal.

Wednesday’s event marked the first time a UN biodiversity conference had featured a day dedicated to finance. Representatives from pension funds, asset managers, central banks, data providers and many more gathered to discuss the private sector’s role in tackling the nature crisis.

In his concluding remarks, Carney said the world “is still not acting with the urgency that the twin crises of nature and climate demand”.

Moving forward, he suggested five priority areas, including one regarding net-zero transition plans.

“As net-zero commitments move from targets to action, private finance must ensure their net-zero transition plans include clear priorities on deforestation, and protecting nature and restoring biodiversity,” Carney said.

Another recommended focus surrounded the upcoming Post-2020 Global Biodiversity Framework – which is entering its final days of negotiations – he stressed the need for it be ambitious in order to spur necessary near-term policies, including creating clear guardrails for the financial sector.

He also called on the parties to the convention to establish a mandate within Goal D and Target 15 to align all financial flows with nature goals. “With this in place finance can be held to account for aligning with the goals of halting and reversing nature loss and scaling nature-based solutions,” he said.

Carney also said on supervisors to develop expectations for how financial institutions should manage risks from the degradation of nature and biodiversity.

Finally, he concluded authorities should support the efforts of the private sector to scale high-integrity carbon markets.

Public sector support

COP15’s Finance Day also saw a slew of other announcements, including a promise by Steffi Lemke, Germany’s environment minister, of €29 million of support over six years for the Taskforce on Nature-related Financial Disclosures (TNFD).

Elizabeth Mrema and David Craig, co-chairs of the TNFD, said: “This funding provides the TNFD and its network of knowledge and implementation partners with the capability to complete the technical design work of our recommendations, and ensure alignment with emerging sustainability standards and regulations around the world.”

Finland’s ministry of finance also released a strategy on climate and nature.

For the UK, Joanna Penn, parliamentary secretary to the Treasury, said the government had committed £7.2 million to a “nature-positive economy programme”.

During a panel, she said this will “support governments, central banks, businesses and financial institutions to integrate nature-related risks and opportunities into decision-making and unlock new nature markets and mobilise public and private flows for nature”.

The International Development Finance Club (IDFC), which comprises 27 national and regional development banks, also made a series of commitments to support an ambitious and effective framework, with a potential to “mobilise more than $100 billion of biodiversity finance by 2027”.

Among the promises, members said they will develop their biodiversity strategies or action plans, combining risk management and impact mitigation, as well as direct conservation and mainstreaming finance.