By Will Bugler
The UNEP Finance Initiative launched last month a technical background paper on adaptation finance which identifies barriers and opportunities for scaling up financing for climate change adaptation and resilience building. The paper, ‘Driving Finance Today for the Climate Resilient Society of Tomorrow’ refers to adaptation as “the biggest investment opportunity of this generation” with huge investment needs to build social and economic resilience.
The report was authored by an expert team led by Stacy Swann and Alan Miller of Climate Finance Advisors, with contributions from a review panel that included Acclimatise CTO Dr Richenda Connell and CEO John Firth who were joined by other experts from banking, investment, insurance, academia and government.
The release of this paper is a prelude to the first flagship report of the Global Commission on Adaptation (GCA), which is due to be presented on the 23rd September. Launched last year, the GCA aims to accelerate adaptation action, raising it up the political agenda and encouraging bold solutions such as smarter investments, new technologies and better planning.
The ‘Driving Finance Today’ paper identifies the barriers to scaling up financing for adaptation which include weak policies and conventions in the financial industry and a low technical capacity for climate risk management amongst others. It reflects the fact that despite a great deal of demand for climate adaptation finance, with UN estimates suggesting that by 2030 it will take $140 to 300 billion of investment per year to strengthen the resilience of societies and economies to climate change, progress to mobilise funding has been slow.
The paper also identifies a range of opportunities to accelerate the investment required to prepare the planet for climate change, though these face additional barriers such as the perceived lack of private benefits and the immaturity of business models. It presents six recommendations, with illustrative case studies, to promote resilience investment:
- Accelerate and promote climate-relevant financial policies;
- Develop, adopt, and employ climate risk management practices;
- Develop and adopt adaptation metrics and standards;
- Build capacity among all financial actors;
- Highlight and promote investment opportunities; and
- Use public institutions to accelerate adaptation investment.
Collectively, these recommendations provide the outline of a program that is ambitious, actionable, and can directly impact how finance can be unlocked for adaptation and resilience.
Download the UNEP FI / GCA background paper on adaptation finance here.
Listen to the webinar held for the launch of the paper here.