Global | Don’t look up, look around

2021 brought us the scientific certainty that climate change cannot be explained without human intervention. We can no longer look up as if we were not to blame. Ambitious calls for climate action from governments and multilateral agencies are a sign, but there needs to be a follow-through.

Key points

• Key points:
• The evidence is not always straightforward, but the influence of human activity on observed changes in extreme weather events (such as heat waves, heavy rainfall, droughts and tropical cyclones) is likely.
• To achieve the goal of net zero emissions by 2050, in line with the 1.5°C target of the Paris Agreement, we must continue to decouple economic growth from greenhouse gas emissions in developed economies and, above all, start to do so in emerging economies.
• We need global policies that are sustained over time, look to long investment horizons, are decisive in terms of incentives and emission price increases so that the private sector can align financing flows with the huge investment required for the energy transition (but will they be enough?).
• The development of financing for environmentally and socially sustainable activities is ramping up, with total financial assets under this label exceeding $1 trillion. However, the investments required for the energy transition alone are already close to this figure.
• The setting up of a regulatory framework and classification applicable to all jurisdictions is key to ensure that saving and investment flows that the financial system handles are directed towards environmentally sustainable goals.

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