9 July 2019
The SOAS Centre for Sustainable Finance hosted three events as part of London Climate Action Week. In a joint event with the Climate Bonds Initiative on How Should Central Banks Respond to the Impending Climate Crisis?, Sean Kidney (CEO, Climate Bonds Initiative), Theresa Löber (Head of Climate Strategy, Bank of England), Daniela Gabor (Professor of Economics and Macro-Finance, University of West of England), Prashant Vaze (Head of Policy and Government, Climate Bonds Initiative) and Ulrich Volz (Founding Director, SOAS Centre for Sustainable Finance) discussed the role of central banks in greening the financial system and fostering a low-carbon transition. While there was a general agreement that central banks ought to address climate risk in the financial sector, views differed on the extent to which central banks should play an active role in scaling up sustainable finance.
Panel discussion on the role of central banks in addressing climate risk.
Together with the think tank E3G and the LSE’s Grantham Research Institute, the SOAS Centre for Sustainable Finance hosted a discussion on Financing an Inclusive and Just Transition to a Net Zero Economy to discuss how finance can accelerate positive change on climate action in the real economy. Kate Levick (Head of Sustainable Finance, E3G) emphasised the role of public finance and financial regulation for a resilient, just transition, while Nick Robins (Professor in Practice for Sustainable Finance, LSE Grantham Research Institute on Climate Change and the Environment) highlighted the importance of mobilising private finance for achieving a just transition. Ulrich Volz underlined the international dimension of climate injustice, pointing to research findings that climate vulnerable countries have to pay a risk premium on their borrowing due to their vulnerability – a perversion of the polluter pays principle that undermines environmental justice. These presentations were followed by two panel discussions. In the first panel, Emily Hickson (Cause Strategist Net Zero by 2050, The B Team), Aleksandra Tomzcak (Policy Coordinator, Directorate General for Energy, European Commission & Coordinator, European Commission Coal Regions in Transition Platform), Agata Kuzminska (Just Transition Local Activist, Greater Poland Region), Rei Tang (Climate Change Program Officer, Stanley Foundation) and James Diggle (Head of Energy and Climate Change, Confederation of British Industry) discussed regional transition challenges, and how low carbon investments can be attracted by regions that have been hitherto dependent on high-carbon industries. In the second panel, Emily Hickson, Michael Wilkins (Head of Sustainable Finance, S&P Global Ratings), Alex Doyle (Head of International Green Finance, BEIS), Bettina Reinboth (Head of Social Issues, PRI) and Ed Wells (Head of Global Markets Policy, HSBC) discussed the role of finance in (re)investing in carbon intensive regions.
Engaged discussion at the event on “Financing an Inclusive and Just Transition to a Net Zero Economy”
Lastly, together with the V20 group of climate vulnerable countries and the Munich Climate Insurance Initiative, the SOAS Centre for Sustainable Finance convened a discussion on Scaling Up Low-Carbon and Resilient Investment in the Face of Climate Vulnerability. The event was opened by SOAS Director Baroness Valerie Amos and a compassionate speech by Doreen de Brum, the Ambassador and Permanent Representative of the Republic of the Marshall Islands to the United Nations Office and other international organizations in Geneva. Ulrich Volz delivered a short background presentation in which he outlined the effects of climate vulnerability on the cost of capital, presenting findings according to which climate vulnerability has already raised the average cost of debt in a sample of developing countries by 117 basis points. Sara Jane Ahmed (Finance Advisor, V20) and Viktoria Seifert (Project Associate, Munich Climate Insurance Initiative) subsequently outlined the Accelerated Financing Mechanism and the Sustainable Insurance Facility, two instruments that are envisaged to address the cost of capital problem in the V20 countries. Naoko Ishii, CEO and Chairperson of the Global Environment Facility, delivered a rousing keynote speech in which she called for system change in finance, land use and food production. Different solutions to addressing the cost of capital problem were pondered in the ensuing panel discussion by Doreen de Brum, Naoko Ishii, Jerry Skees (Chief Strategy Officer and Director, Global Parametrics), Soenke Kreft (Executive Director, Munich Climate Insurance Initiative), Carlos Sanchez (Director of Climate Resilience Finance, Willis Towers Watson), Dharshan Wignarajah (Team Leader – Private Sector Resource Mobilisation, UK Department for International Development) and Victor Murinde (Director of the Centre for Global Finance & AXA Professor in Global Finance, SOAS). While the challenge was considered enormous, the discussion clearly showed that many promising solutions exist to scale up investment in climate resilience and insure against losses in climate vulnerable countries.
Naoko Ishii, CEO and Chairperson of the Global Environment Facility, delivering her keynote speech
On the SOAS Centre for Sustainable Finance
The SOAS Centre for Sustainable Finance is a newly established interdisciplinary research hub bundling expertise in sustainable and climate-related finance and its role in transitioning the world to a low-carbon, resilient and equitable future. Located in the heart of one of the world's financial capitals, the Centre addresses issues including green financial governance, climate and environmental risk for public and corporate investors, climate vulnerability and the cost of capital, financing the SDGs and renewable energy investment. The Centre seeks to develop cutting-edge knowledge and understanding of climate and sustainable finance in both the Global North and South and acts as a focal point for economic and policy debates in this area.
On London Climate Action Week
The first ever London Climate Action Week was held from 1-8 July 2019 on behest of Sadiq Khan, the Mayor of London, as London’s response to the climate emergency. The week brought together London’s climate expertise and talent from across sectors to run events across the city focused on taking local, national and international action. These events highlighted the scaling up of practical solutions and identifying new solutions to help cut carbon emissions to keep global temperature increases within 1.5C and support the Paris Agreement.