Oil Change International, Rainforest Action Network, Amazon Watch, Asian Peoples Movement on Debt and Development, Asociación Interamericana para la Defensa del Ambiente, Bangladesh Krishok Federation, BankTrack, Catholic Network US, Catholic Youth Network for Sustainability in Africa, CEE Bankwatch Network, Center for Energy, Ecology, and Development, Center for International Environmental Law, Centre for Financial Accountability, Climate Action Network Canada – Réseau Action Climat Canada, Climate Hawks Vote, Coastal Livelihood and Environmental Action Network, Digo Bikas Institute, Environics Trust, Environmental Defence, EquityBD, Friends of the Earth France, Friends of the Earth Japan, Friends of the Earth US, Focus on the Global South, Freedom from Debt Coalition, Fundación Ambiente y Recursos Naturales, Ginew Collective, Greenpeace, Indian Social Action Forum, Indigenous Environmental Network, Kiko Network, Majority Action, Manthan Adhyayan Kendra, Market Forces, Migrant Forum Asia, Monitoring Sustainability of Globalization, Nadi Ghati Morcha, Oriang Women’s Movement, Pakistan Fisherfolk Forum, People and Planet, Philippine Movement for Climate Justice, Positive Money, Private Equity Stakeholder Project, Profundo, Reclaim Finance, Re:Common, Recourse, Riverbasin Friends, Sanlakas, Sierra Club, Solutions for Our Climate, Stand.earth, Stop the Money Pipeline, Tax & Fiscal Justice, The Sunrise Project, Urgewald, WALHI Friends of the Earth Indonesia, Womenhealth Philippines, Women’s Earth & Climate Action Network, 350.org
A global set of 60 climate and rights groups has issued a new set of “Principles for Paris-Aligned Financial Institutions: Climate Impact, Fossil Fuels and Deforestation.” The principles offer a roadmap for the decarbonization of the finance sector on a timetable aligned with the Paris Agreement.
Financial institutions must adopt a commitment by COP2612 that requires that the projects and companies it supports are aligned with 1.5ºC. That means they must:
- Immediately exclude financing13 for any project that involves exploration for new fossil fuel reserves, expands extraction of fossil fuels, or builds new fossil fuel infrastructure;
- Rapidly phase out all financing for coal companies;
- Immediately cease finance for any company that is expanding fossil extraction or infrastructure, or exploring for new reserves;
- Prohibit financing for any project that involves the degradation or loss of natural forests or other natural ecosystems; and
- Make explicit what it is requiring of fossil fuel or deforestation-risk clients, by when, and what consequences follow from failing to meet those requirements.
Financial institutions must have in place a process by COP26 to measure and disclose its climate impact, and must commit to phase out financed emissions in alignment with 1.5°C and to develop a specific plan for establishing science-based targets. That means they must:
- Make a commitment to reduce its climate impact to zero by 2050 at the latest, with an interim commitment of halving its impact by 2030 at the latest;
- Measure and disclose its overall carbon footprint in transparent and verifiable fashion;
- Financial institutions and their clients cannot achieve Paris alignment through “net zero” accounting based on discredited schemes such as offsets, bio-energy with carbon capture and storage (BECCS), tree plantations, or other untested “negative emissions” or geoengineering technologies; and
- Install a process for transparent third-party monitoring of its progress toward meeting its commitments and annual reporting of the results.