Peer-to-peer exchange: Climate Strategy

The first of the five voluntary principles in the “Mainstreaming Climate in Financial Institutions” is to: COMMIT to climate strategies. A climate change strategy has the crucial role of driving an institution’s efforts on climate change. Climate change strategies are not a “one size fits all”, instead, each organizations’ strategy differs according to institutional mandates, their operations and level of climate ambition. The manner in which an organization establishes and adopts climate strategies will also vary according to the structure, who develops the strategy, the iterative consultation process and the level of engagement from management teams.

This webinar was an opportunity for FI professionals from strategy and climate/sustainability departments to share their experience and hear from their peers.

Agenda of the Webinar:

• Introductory remarks (Secretariat)
• Presentation
• Roundtable open discussion

Participants were invited to share their experience on a voluntary basis. 

Proposed guidance questions:

• How did you develop and adopt your climate strategy?
  • What were and are the main challenges or barriers your institution has faced in the development, approval and implementation of your climate strategy and how did you overcome them? What recommendations do you have for your peers?
• What key elements helped climate strategies to be approved by upper management, how did this approval process come to fruition?
• How does your climate strategy relate to other of your organizations’ strategies (particularly in terms of objectives and articulation)?
• How does this process relate to the development of a transition plan?
• How have climate-related scenarios been used to inform your organization’s strategy and financial planning?
• What is your periodic review process like, are you benchmarking climate strategies with the broader industry?
• What are the KPIs used to measure the success of your climate strategy?
• What were the key success factors in the development, approval and implementation of your climate strategy?

Concluding remarks

Summary

• Bank of Africa, Development Bank of South Africa, and AFD shared their experiences.
• Having strong endorsement ambition and direction from upper management helped move institutions to initiate and develop the process of developing climate strategies. Once the ambition is set by upper management, institutions have to define as part of the strategy, what the commitment implies and how it will be implemented. SIs have been conducting pilot exercises to test the strategy and identify potential barriers.
• The development of a climate strategy was presented as an iterative process. It has taken some SIs several years to understand Paris Alignment and begin operationalization.
• Training within the organization was evidenced as a key success factor to ensure the buy in and implementation of the strategy. SI recommendation to have a key climate stakeholder in each team to facilitate interdivisional communication and better understanding of climate objectives.
• As part of the assessment of their climate performance, institutions have highlighted the need to identify best in class methodologies and to address data access issues. To address these SIs have highlighted the importance of partnering with MDBs and national regulators.
• Recently, institutions are increasingly developing a strategy focusing not only on climate change, but also looking at the just transition and biodiversity considerations. This requires specific methodologies and processes to identify interlinkages between different areas of focus.