- Veronica and Maria, hi.
I just want to start by asking both of you actually
what kind of climate finance announcements
and pledges would you be excited to hear
about during the next two weeks?
And perhaps some that might dishearten you a little bit.
- Yeah, well I think the first and the most
important announcement will be what the negotiators agree
on to replace the hundred million target that thus
far even itself has not been made.
So we should be looking
at how much are countries willing to put
on the table to finance, not just mitigation,
but also adaptation and resilience.
We should also be looking for how much
of that is going to be focused
on adaptation and resilience in particular.
- And just to add to that,
I think what I would be super excited is
when is it going to start to flow?
Because I think that's one of the biggest challenges
are these big commitments.
We see a lot of pledges but when are the dollars
and over what timeframe
are we going to start seeing countries receive it?
- Veronica, we're going to be hearing a lot
of climate finance numbers over this fortnight
from countries, from companies.
Which numbers should we be focused on?
- Yeah, so there's a few.
There's obviously how much of
that hundred billion dollar target; will it be refreshed?
That's public sector money meant
to help developing countries,
finance mitigation, finance adaption and resilience, that's critical.
But there's some other numbers that really matter.
One is how much of that is going
to be concessional finance that can really mobilize
and leverage the private sector?
Because that's how we're going to get
from these billions to trillions.
Another critical number will be how much
of that is grant-based?
Because in many of these highly vulnerable debt
and highly debt-affected countries, they just need grants.
And I think there's another type of number
that we're going to see, not in one place,
but a number of really exciting announcements
from philanthropy, from corporations,
who are stepping up to say,
"Look, we're willing to do this ourselves as well."
And I think Rockefeller's going to have
some great news to share there too.
- Maria, tell me about the Rockefeller report
recently commissioned.
What was the motivation behind that? What did you find?
- You know, the main motivation was
to start having this discussion
on the actual flow of dollars.
Again, like there's been quite a number of corporations,
financial institutions and so forth.
We have the net zero commitments
we've got government commitments and so forth.
But we wanted to try to have a very granular discussion
on kind of where money is starting to flow
and just like to give you an example
of the commitments that were made in 2020:
in actuality only about 16% of that money flowed.
If you use some very strict definitions, maybe, what is it
33% if we use some more flexible
I think the main takeaway there is it's not
a hundred percent and it's not over a hundred percent.
So what are those figures?
What do we understand about the different types
of flows that we need? And that we want to start a discussion
so that we're talking
about actually getting the money where it needs to go.
- Yeah, the report is “What Gets Measured Gets Financed.”
Veronica, the report makes several references
to financing efforts that are not being tracked well enough.
- Yeah.
- So do you think perhaps we're underestimating
the real picture of how much money
is actually flowing?
- Yeah, so, this is a fraught question
because we're having this discussion
in the context of a wider backlash underway
about greenwashing, backlash against ESG.
So we have to be very, very careful when
describing what actual climate finance means.
The definitions that most people use
within the UNFCC definition is how much money
is actually deployed into a project that is actually
making real decarbonization impact right away.
And that is a critical number.
When we did our analysis, however,
we found an additional 600 billion of financing, however
that is somehow either not being effectively tracked
or going into efforts that don't meet that strict criteria
but are still nevertheless having some forms
of climate impact.
And to Maria's point about conversation
I think we need to have more conversations around
first of all
how do we get better disclosures from the private sector?
The corporations who we work with
are putting massive dollars to work
within their own supply chains to make them more resilient
to reduce, to mitigate, to reduce the emissions from them.
That money's not being tracked.
So how do we get better disclosures from the private sector?
And then secondly, how do we think
about some of these other ways of achieving decarbonization
that don't necessarily,
fall within certain definitions that we can really
start to put our hands around all the money
so that we have a greater impact.
- Yeah, I was in a session today this morning at COP
and we talked about kind of the barbell where
things that can be completely understood as green energy
and then at the other end you have the brown energy,
the fossil fuels and so forth.
Much of what we're talking about, too,
there's the strict definition of climate finance
but what's the green and the brown in the middle?
Kind of the transition finance.
And I think we do have to stick to this,
the definition of climate finance in certain instances
but we also want to widen the lens because I think
by widening the lens, maybe we can also bring more people
into the tent and understand what is it
that we need to tackle at kind of across the spectrum
as we move to a more fully green energy environment.
- Yeah, we're working with a number of banks right now
who are looking to help their own clients’ companies
all across the world to decarbonize.
And what we're finding is companies are taking
out just general loans to do really important climate work.
And the types of impact of that lending,
it's not showing up on anyone's books and it's that
and if we want climate finance to truly go mainstream
like we have to find some way to really think about that
and not just focus on the one end of the barbell.
- Yeah.
- So before I let you go.
What key messages do you have?
Would you like to highlight for COP negotiators?
- For COP negotiators?
I think the message is
let's get very granular on where the money is flowing,
where it flows across the spectrum.
And I think it's just, I feel
like this is a message that you'll hear often here
but every year it's the, we don't have time
so the urgency of getting to solutions
and maybe we have to broaden the discussion
so that more of us are around the table
and we focus on this urgency so that next year
we maybe even outperform what expectations we had.
- Yeah, I’d build on that
and say to the COP negotiators, the private sector
they're ready to move, they've got the trillions
they're ready to move, but they need three things.
They need the incentives,
subsidies to the actual technologies de-risking to
help make these investments that much more compelling.
They need enablement, they need partnerships
with R & D, with governments, with communities
on the ground to like create bankable investable projects
and finally they actually need a push.
I think the important work
of TCFD and broader risk disclosure is to really
enable the private sector to realize how much is at risk
and therefore how much we do actually need to move now.
Those are three things that COP negotiators
should be putting on the table
in addition to all the public sector oriented finance.
- Good. Maria, thank you so much.
- Thank you.
(smooth upbeat music)