Towards financing a just transition to low-carbon economies. A new just transition finance tool for banks and investors

This is a joint event with the International Labour Organization (ILO).

Please note the time listed for this event is local time (EET).

The importance of connecting climate action with positive social outcomes is increasingly recognized by investors, banks and other actors. The notion of a just transition is gaining traction but concrete efforts are still at a nascent stage. The ILO and the LSE Grantham Institute will host at COP27 event to launch a new just transition tool on banking and investment and discuss how financial institutions can move beyond commitments and take practical steps for a just and ambitious climate transition. The event will address the following questions:

• What is the role of financial institutions in supporting a just transition?
• What can be leveraged from existing sustainable finance frameworks and instruments and where are the gaps?
• How can a just transition logic be integrated in financial institutions’ organisation and operations?
• Reflections on actionable entry points will be complemented by experiences and learnings from financial sector practitioners and leading experts.

Agenda

Introductory remarks (5 min)
Eric Oechslin, ILO Decent Work Country Team/Country Office Director, ILO Cairo, Egypt 

Presentation of the ILO-LSE Just Transition Finance tool (10 min)

• Camilla Roman, Policy Specialist, Green Jobs, ILO 
• Brendan Curran, Policy Fellow, LSE Grantham Research Institute 

Panel Discussion “Towards financing a just transition to low-carbon economies.  A new tool for responsible banks and investors” (30 min)
Moderated discussion by Nick Robins, Professor in Practice – Sustainable Finance

• Mandy Rambharos, Environmental Defense Fund VP – Global Climate Cooperation
• Gianpiero Nacci, Director, Sustainable Business and Infrastructure, Climate Strategy and Delivery, European Bank for Reconstruction and Development (EBRD) 
• Tamsin Ballard, Director of Climate & Environment, Principles for Responsible Investments 
• Nazmeera Moola, Chief Sustainability Ninety One 

Q&A (20 min)

Closing Remarks (10 min)
Maria Selin, Head of Regional Development Cooperation, Embassy of Sweden in Amman, Jordan

Background

Achieving climate goals requires a far-reaching economic transformation that entails extensive employment and socio-economic implications. Ensuring a just transition is a crucial enabler of ambitious climate action and an engine of sustainable development. Delivering a just transition means maximising positive employment and socio-economic outcomes and minimising risks of economic and social disruption and leaving no one behind. The ILO Guidelines for a just transition towards environmentally sustainable economies and societies for all provide a guiding framework and outline entry principles and potential policy entry-points to promote and manage a just transition grounded in social dialogue.
A range of financial ecosystem players are needed to ensure that capital flows are supportive of a transition that delivers social and employment gains.

Given the unprecedented scale of financial resources required, an effective combination of different public and private sources of finance can generate a major transformational impacts. Financial institutions have a key role to play in a just transition both in relation to their own behaviours and practices and the behaviour and practices they facilitate through the access to capital and to financial services in general. As market participants increasingly commit to climate action, it is crucial that just transition priorities are acknowledged, shared and acted upon by the financial ecosystem actors and partners.

To support this process and respond to the need for specific guidance expressed by financial institutions, the ILO and the LSE Grantham Research Institute teamed up to develop a specific tool. The Just Transition Finance tool to be launched during the above-mentioned event targets investment and banking activities and provides action-oriented, practical guidance on how to efficiently integrate just transition considerations across organisational structures and operations. It also highlights major entry points and outlines examples of emerging practices.