The need for unity between companies, governments and civil society was highlighted

The enabling of the financing for the transition to a low carbon economy was the topic of the first of the four panels co-organized by the Institute for Climate and Society (iCS) and partners on the second day of the Brazilian Forum for Climate Finance, held in São Paulo, on February 26 and 27. “Brazil has an enormous competitive advantage in indicating paths and creating bridges and partnerships between various financial actors and those from civil society, which is essential for the creation of innovative climate finance mechanisms,” said Maria Netto, the executive director of iCS, during the opening of the debates.

Co-organized by iCS and the World Business Council for Sustainable Development (WBCSD), the panel “Corporate Transition Plans: Enabling the Financing to Transition with Integrity and Implementation,” presented to the live audience and those online an overview of this topic, which is one of the priorities for the G20 Sustainable Finance Working Group.

The debate showed that effectiveness depends on the establishment of partnerships and joint work between investors, the creation of public policies that are capable of inducing investments, solutions, opportunities, and the creation of the appropriate environment for a rapid transition, which occurs with government incentives and policies that are capable of accelerating the climate transition. One way would be to align corporate strategies to the goals for the reduction of carbon emissions as defined by the national governments, namely the NDCs.

According to Jennie Dodson, a senior director of WBCSD, one of the challenges in her work of coordination between companies, governments and civil society is showing the direct connection between corporate value and engagement with sustainability. “The transition plan is a critical step but the companies need to incorporate sustainability into their products and services, because this is where the results will come from in the future,” she stated.

“Brazil has the conditions to be a hub of green solutions for the world,” said Marina Grossi, the president of the Brazilian Business Council for Sustainable Development (CEBDS), which comprises of 110 large companies, with revenues of around 50% of the national GDP.

Need to accelerate the transformation

“The transition to a low carbon economy is complex and involves operational risks, but the most important thing is to start,” said Mark Manning, an independent consultant in sustainable finance at the Grantham Research Institute Centre for Economic Transition Expertise, at the London School of Economics (LSE). “This is a complex process and it is necessary to use sustainability as a corporate strategy in the entire business.”

Corporations have come a long way up to this point but, when it concerns the climate agenda, there is still a need to move faster. This was the main consensus among the panelists: the need for unity, coalition and connection between companies, governments and civil society.

To date, for example, voluntary initiatives by the private sector for the transition to a clean energy model are insufficient, although they are opportunities, said Alan Gomez, the general director of the alliance of financiers of the GFANZ Latin America and Caribbean Network. He argues that businesses need direction, and that the national goals for the reduction of emissions can not only indicate the path of the transition, but also facilitate the change to an industry anchored in the climate agenda.

Linda Murasawa, the co-founder and director of Fractal Assessoria e Desenvolvimento de Negócios, assessed that the corporate world needs to start working with predictive models and that their planning should take into account the climate and transition risk.

The impact of a corporate strategy can become global, even if its action is local, according to Sean De Montfort, the manager of the Climate Finance Program at the Sequoia Climate Foundation. He cited the example of supervisory measures with an impact on the value chain that European companies imposed on their businesses, and which had a global scope. “We need to do the same with carbon neutrality, in order to influence how companies operate, with coordination and harmony from the regulators, which includes countries and international instruments such as the G-20 and other multilateral forums,” said Montfort.

In general, the panelists recognized that a significant amount has already been achieved, but it is necessary to progress as quickly as possible if Brazil really has the ambition to take the lead in the global climate agenda. Brazil, they said, has the necessary attributes to become a global leader in the low carbon economy and the productive sector is fundamental in the speeding up and acceleration of this transition.

The Brazilian Forum for Climate Finance was jointly organized by the Arapyaú Institute, the AYA Institute, Institute for Climate and Society (iCS), the Igarapé Institute, the Itaúsa Institute, the Open Society Foundations and Uma Concertação pela Amazônia.


Credit: Fotoka/Divulgação

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