Accelerating a Just and Resilient Transition to Net Zero
The San Giorgio Group is a convening of key financial sector actors and experts actively engaged in a just and resilient transition to net zero. The 2019 San Giorgio Group moved the needle on important topics such as financial alignment with Paris, green bank design, risk disclosure, and mobilizing investment for areas like adaptation, land use, and sustainable cities.
Serving as the premier, invitation-only platform for cutting-edge climate finance thought leadership, we prioritize frank input and engagement to identify the most promising opportunities, scale up best practices, and connect with action-oriented leaders capable of creating change within their organizations and the greater green finance community.
The need for this coordination is more important than ever: in 2022, our community needs to increase ambition, leveraging the momentum of climate finance finally moving onto center stage, while still facing the challenge of competing economic, political, and institutional forces that seek to forestall climate urgency.
Thursday, 24 March 2022
9:00 – 9:15 | Welcome and Opening Remarks
9:15 – 10:45 | Net Zero Integrity: Advancing the Action
Momentum is building towards systemic transformation, driven by progress in technologies, regulatory achievements, mainstreaming green finance into funds and financial products, discussions on high-quality carbon markets, and increased public awareness and advocacy. Despite this progress, major questions remain regarding ambition of goals, transition credibility, implementation capacity, transparency, and policy consistency. So, what can financial actors expect in 2022, and how can we best drive the needed change.
- What are the gaps in frameworks to clarify and track net zero criteria with integrity? Which levers will be most effective in increasing accountability and transparency?
- What are the key institutional barriers to advancing engagement on integrity during the transition? How do we accelerate capacity across the financial ecosystem?
- Where can we focus efforts to ensure integrity as we continue to scale? How can we harness high-quality carbon markets to facilitate genuine net zero commitments?
11:15 – 12:45 | Energy Transition: Breaking the Cycle of Addiction
Despite progress on net zero commitments and expansion of renewable energy, the energy demand and inflation pressures of 2021 paved the path for increased production and consumption of fossil fuels amongst every major producer and emitter, from China to India and Japan to the United Kingdom. Despite these headwinds, some progress is being made: the “South Africa coal deal” at COP26 was a bright spot for energy transition in 2021. We need to amplify these efforts while simultaneously scaling up renewable energy production rapidly.
- How do we efficiently replicate the South Africa deal for other major developing economy coal users and producers (India, Indonesia, Philippines, Vietnam) that are structurally very different?
- Are there public-private partnership models that can accelerate R&D and commercialization of industrial decarbonization and fossil fuel decommissioning?
- How can we better quantify and clarify economic opportunities and job transition plans? Are there tools that Development Finance Institutions (DFIs) can deploy to scale energy transition finance?
14:15 – 15:45 | How to Ensure a Just and Resilient Transition to Net Zero?
The COVID pandemic has increased awareness on the necessity of addressing sustainability issues beyond mitigation to achieve our net zero goals. The most recent IPCC report made clear that societies are ill-equipped to adapt. While the potential scope is broad, the financial eco-system must incorporate resilience in all investments it supports, invest in nature-based solutions, address biodiversity, and ensure that the transition it finances is just.
- What do you see as the most promising initiatives/activities/collaborations currently underway to address the significant barriers to increase finance to adaptation?
- What instruments exist – and what are missing – in our toolbox to accelerate just transition? How do we ensure that the just transition agenda does not unintentionally undermine climate goals?
- What are the private sector opportunities, including insurance and other products? What policy or regulatory changes are most feasible in the short term to help further mobilize private capital?
16:15 – 17:45 | Public Finance: Evolving the Model
Development banks, which include about 400 multilateral, bilateral, and national finance institutions, are the crucial nexus between capital flows and real impact on the ground. Leveraging their institutional knowledge of what has worked (and what has not) and their networks with local government and business, there is significant potential to address key investment barriers such as portfolio scale, currency risk, and domestic mobilization. While a handful of DFIs are leaders, the majority in this class are lagging where it matters.
Friday, 25 March 2022
9:00 – 10:30 | Are Private Investors Addressing Climate Transition Risk?
Some of the most significant recent progress made in advancing net zero goals is proactive course shifts by the private financial sector – made even in the absence of supporting regulatory frameworks. The private financial sector is, of course, not acting out of altruism, but out of business sense built from a growing body of evidence around longer-term sustainability performance. But questions remain about the fundamentals forming the basis for the private sector sustainable finance transition.
- Are private financial institutions using the risk and profitability models incorporating potential future climate change impacts to assets and returns? Where do we stand in terms of double-materiality assessment and reporting, including standardization?
- What does the proper balance of early-stage de-risking look like between the donor, development, and private sectors? Particularly to help developing countries eliminate carbon emissions.
- What systemic issues are perpetuating sub-optimal accounting of climate-induced risks (e.g., passive indices, outdated performance benchmarks)? What are the next steps to address those?
11:00 – 12:30 | On the Brink of Transformation: How to Get to Scale at Speed?
We have seen a surge in momentum and commitments to address the climate emergency since the last San Giorgio Group meeting. We need to harness this momentum to achieve the scale and speed at which financial flows are deployed to deliver the needed impact, while maintaining underlying integrity. To achieve this, we need a full economic transformation such that all new capital formation (including in many cases its early replacement) and, critically, the global financial sector supporting it, is climate-aligned. The potential just to avoid locking in carbon-intensive infrastructure for decades to come is huge by itself. This closing discussion will build on insights from this meeting with a view towards achieving scale at speed.
- Are institutional inertia and risk aversion the reasons for insufficient bankable projects that attract international investors? Or are there challenges that need to be addressed including local risks and capacity of domestic investors and financial markets?
- How can we be efficiently replicate successful large-ticket transactions (à la the South Africa coal deal), as well as quickly scale up smaller deals systemically given the variation amongst markets in terms of capacity, structure, and risk?
- How can we create incentives – for countries and for the public and private financial sectors – to raise ambition and drive action with integrity to mobilize the trillions in climate finance needed?
12:30 – 12:45 | Bringing it All Home
We will close the meeting with a summary of the discussion and review of key priorities we will all take back with us.