UK-Norway Collaborative Initiative Seeks to Boost Climate Finance

The UK and Norway launched an initiative on sustainable finance that will serve as a platform for British and Norwegian financial institutions to share knowledge and best practices focused on actionable climate solutions in the financial sector and explore the regulatory frameworks and investment decisions that would be necessary to achieve a zero-emissions economy.

Launched in February 2021, the UK-Norway Sustainable Finance Action Platform is a collaborative initiative between the British Embassy in Oslo and local Networks of the UN Global Compact in the UK and Norway.

The collaborative is organized around the five action tracks of the finance campaign of the Glasgow Climate Change Conference (COP 26):

The Platform will host a series of workshops over 2021 in preparation for COP 26, working with other donor countries to secure more predictable finance commitments, increase finance in the underinvested sectors like adaptation and nature, and initiate negotiations on the successor to the USD 100 billion per year climate finance goal.

According to the COP 26 finance campaign, before COVID-19, “many estimates of the financing gap needed to meet the Paris goals” were at around USD 7 trillion annually. However, “[w]e have seen some progress” in recent years, including through initiatives such as the Net Zero Asset Owners Alliance and Climate Action 100+. The Net Zero Asset Owners Alliance is comprised of companies with USD 5 trillion of assets under management that have committed to net zero by 2050. Climate Action 100+ includes investors with USD 40 trillion in assets, with focus companies covering 80% of global industrial emissions, who aim for those assets to be aligned with the Paris Agreement, increase disclosure of climate risk to assets, and strengthen governance.

In 2019, issuance of green bonds achieved a record USD 257.7 billion, and in the first quarter of 2020, global sustainable open-ended funds achieved USD 40 billion in new assets, representing a 41% increase over the previous year.

The UK-Norway Sustainable Finance Action Platform intends to build on these achievements by providing a collaborative space for private finance, international financial institutions, central banks, regulators, and financial ministries to catalyze the mobilization of exponentially greater volumes of climate-related financial flows.