France is strongly committed to green and sustainable finance
Annual New York international Financial Forum Europlace
« Green and sustainable Finance : from billion to trillion scaling-up Europe / US Action Agenda »
Opening remarks by Mr. François Delattre, Permanent Representative of France to the United Nations
18 April 2018
Monsieur le Gouverneur de la Banque de France,
Madame la Sous-Gouverneure,
It’s a great pleasure and privilege for my team and for me to be here with you this afternoon on this special occasion and I’d like to start by thanking Paris EUROPLACE and its Chairman Gérard Mestrallet, not only for organizing this important Forum here in New York but also for his much appreciated leadership and commitment, with a special word of thanks also to our friend Arnaud de Bresson.
Actually there are three main points I would like to make today.
1. The first point is about the solid and predictable international framework that we now have, seen from a UN perspective, with respect to green and sustainable finance.
a. Let’s not forget that the UN sustainable development goals, the SDGs, are the first pillar of this framework. There is a quiet revolution happening at the UN with the SDGs, in which climate change is a key element, and the challenge is now to make sure that we together spread the word and that this revolution with the SDGs is embraced by the real world, by you, by the investors and the companies.
b. The COP21 is clearly the second pillar – and in many respects the backbone- of the international framework I am referring to.
At the international level, the CoP21 -that I had the privilege of participating in- created a historical momentum for state and non state actors with a particular focus on the private sector. I believe the COP21 was precisely so transformative because it brought together historical participants, state and non-state actors, but also reached out to new participants: the business community and investors. In my experience the level of participation of business and investors was unprecedented.
It was understood that all parties needed to share a common vision of how to effectively transition towards a low-carbon economy.
From another perspective, the issue of finance was absolutely essential in reaching a universal agreement in Paris. It was followed by lengthy discussions at CoP23 as developing countries, and I think rightly so, want to make sure that industrialized nations are adequately supporting adaptation and mitigation measures in most vulnerable countries. This is a challenge that we must have in mind.
c. The one Planet Summit last December is the third pillar of our international framework
President Macron’s immensely successful initiative to host the One Planet Summit, together with the UN Secretary-General and the President of the World Bank, showed –beyond the shadow of a doubt- that the Paris agreement is here to stay. And as you know President Macron made finance the centerpiece of the summit.
Indeed, France’s ambition was to convey a message of urgency in hightlighting how States need to work hand in hand with the private sector and how both public and private financial resources need to be boosted. And as you know the goal has been achieved. Now it’s all about implementation.
Among others initiatives, a coalition called One planet coalition has been created and 12 transformative commitments were made during the summit to scale up both public and private financing for climate action. Several of them are closely related to today’s discussions, as they illustrate the fact that concrete local and global solutions exist to address the challenges we face.
Let me mention for instance, and among many others exemples :
Commitment 4: facilitating access for local governments to green financing
Commitment 6: promoting sectorial shift towards a decarbonized economy
Commitment 9: Actions of central banks and the business sector.
On a more personal note, given the strategic importance to get investors on board to succeed, in 2015 I began to organize and host at the French Mission an informal but structured “Investor Dialogue” with the New York City Comptroller Scott Stringer and California State Controller Betty Yee.
These private, completely off the record meetings with the world’s largest and most engaged investors and their fiduciaries, and with a French flavor, allowed us to discuss climate related risk management and investment opportunities. I will continue of course this serie of meetings, which are extremely productive.
These investors meetings built on the Paris Accord momentum, which resulted in the “Climate Action 100+” announced during the One Planet Summit. This initiative brings together 225 global institutional investors with more than USD $26.3 trillion assets under management to coordinate their actions with the 100 largest corporate greenhouse gas emitters worldwide. So it’s big.
Here, I find extremely encouraging to see how the investment community is embracing the Paris Accord with new investment strategies, investment products and a push for more disclosure on strategy and climate risk.
2. This is number one. My second point is to draw your attention on President Macron’s important initiative of a Global Pact for the Environment.
To make a long story short, the Global Pact for the Environment will be an international legal instrument that consolidates the general principles of environmental law, which is today too fragmented, and gives them legal value. Hence, this project will make international environmental law accessible to States, citizens and stakeholders from the private sector in one single international treaty.
We are of course at an early stage of the process, but the Global Pact for the Environment will help create a place where the same environmental regulations apply to all, regardless of the country, something which will facilitate businesses’ international procedures and ensure they meet their social and environmental responsibilities. In a nutshell, the Global Pact for the Environment will therefore provide greater legal predictability and stability.
3. This is number two. My third point –and I’ll be briefer here- is to acknowledge the outstanding work done by Paris Europlace and its many successful initiatives.
The “Finance for Tomorrow” initiative for instance is a very good illustration I believe of how Paris is positioned to become the world capital of green and sustainable finance.
Indeed, France and Paris have taken the lead on many fronts across the board. Let me give you a few examples.
On the regulatory front, and in the run up to the Cop21 that led to the Paris Accord, France became the first country to require extensive climate change-related reporting for asset owners and asset managers. Adopted in the fall of 2015, the Energy Transition Law, known for its Article 173, accelerated the movement of climate related disclosure.
On the investment front, actions taken by global French investors, including the Caisse des Dépôts launch of its “2°C roadmap” long term strategy, is truly exemplary.
Another example on the investment front is given by the French Development Agency. The AFD as we name it exceeded its 2020 target to allocate 50% of its activities to climate financing in 2016.
A last example -again among many others- in finance was the very successful 7 billion green bond issuance in January 2017 by the French government. By many estimates, 2018 will see a record in green bonds with an estimated 130 billion euros –which makes about 150 billion dollars.
A few months ago, in December 2017, our Environmental Minister Nicolas Hulot and our Finance Minister Bruno Le Maire together published the French Strategy for Green Finance report. Entitled “French Strategy for Green Finance”, this report is an excellent resource that illustrates France’ commitment to this topic.
I also want to commend the strong commitment to this goal by the Banque de France and the French banking and financial industry, of which many distinguished representatives are with us this afternoon.
I hope I have conveyed how each of us in this room plays a part in making sure we achieve the objectives of the Paris Accord. I can only assure you that France is putting energy, talent and resources to make it happen, which has made the sustainable finance ecosystem in the Paris Financial Center one of the most innovative and attractive today.
So my warmest thanks to each and every one of you. You can count on me – and more importantly you can count on President Macron’s strong commitment to green and sustainable finance.