COP27 round-up: Aviva calls for global transition plan for finance by 2024

Financial news from Sharm el-Sheikh: Nigeria adopts IFRS standards; NZBA publishes first progress report on decarbonisation targets.

Aviva Investors has called for the creation of a global transition plan for finance to reform the global financial architecture and mobilise private capital to avoid “climate catastrophe”. The asset manager gave the deadline of the 2024 Bretton Woods summit for this to be established. In the report, Aviva suggested that the financial system could “collapse” before the end of the century if climate issues are not addressed. It recommends that global finance institutions, including the likes of the IMF, World Bank, Financial Stability Board, IOSCO and the Basel Committee, should take several steps, including creating a 2050 net-zero transition plan, making climate a central focus of their mandates and convene a summit to implement climate change reforms. 

Nigeria has announced at COP27 that it will adopt the International Sustainability Standards Board’s (ISSB) sustainability standards when they are issued next year. Emmanuel Faber, chair of the ISSB, said that in the announcement, Nigeria’s Financial Reporting Council noted the standard’s potential to unlock mainstream capital markets investments to support resilient economic development as a big factor in its decision to adopt the standards. 

The Net-Zero Banking Alliance (NZBA) has published updates on its members’ climate commitments at COP27. NZBA’s progress report, the first of its kind since the alliance launched, found that 90 percent of banks have published decarbonisation targets, with 19 additional members delivering their first targets ahead of the 18-month deadline. The alliance, which represents 40 percent of global banking assets, also found that more than 90 percent of signatories have adopted a policy on coal and/or gas financing and have set an emissions reduction target in one or both sectors. 

Investment consultant Willis Towers Watson has launched a new climate tool designed to increase the resilience of the world’s agriculture and food supply, which has become more vulnerable due to extreme weather events. Launched at COP27, the Climate Quantified CROP, which will go live in 2023, will project the individual climate risks most likely to impact each of the world’s agricultural crops.