Financing the Climate Transition: Challenges, Opportunities, and the Path Ahead

💼The finance sector plays a critical role in the climate transition but relies on businesses and entrepreneurs to lead the way.

🌍We need transformational change in our economies, businesses, financial institutions, and public policy to address the climate crisis.

💰There is enough capital to finance the transition, but it needs to be directed towards sustainable solutions and hard-to-abate sectors.

👥Investors need to understand the impact of their investments within a risk and return framework to drive the transition.

✨The finance industry has the opportunity to create sustainable growth and make a greater impact than the industrial revolution.

Why is the current pace of financial capital towards the climate transition insufficient?

—The finance sector is dependent on businesses and entrepreneurs to lead the way, and there is a need for change in public policy, regulation, and evaluation of decarbonization efforts.

Is there enough capital to finance the climate transition?

—Yes, there is a significant amount of capital committed to achieving net zero, but it needs to be directed towards sustainable solutions and hard-to-abate sectors.

What role does aviation play in the climate transition?

—Aviation, particularly sustainable aviation fuel, presents an exciting opportunity for decarbonization. There is a rising corporate demand for sustainable aviation fuel, but the supply is insufficient, requiring investment in multiple production pathways.

Why is the partnership between finance and individual sectors crucial?

—Finance needs to provide long-term capital to support individual sectors in achieving their decarbonization goals, as well as invest in the solutions required for those goals.

What potential impact can the finance industry make in the climate transition?

—The finance industry has the potential to create sustainable growth and make a greater impact than even the industrial revolution by directing capital towards sustainable solutions and understanding the impact of investments.

00:08The current pace and scale of financial capital towards addressing the climate transition is insufficient.

00:37The United Nations estimates that we need trillions of dollars annually to decarbonize the global economy through 2050.

01:35Funds are flowing to climate solutions but not nearly enough, especially to hard-to-abate sectors and the Global South.

02:50Climate-led investing is happening, and finance can change to take sustainability impacts into account.

08:40Sustainable aviation presents an opportunity for decarbonization, but the production of sustainable aviation fuel needs to scale up.

11:59Investors who do not consider climate are running significant risks in their portfolios and not fulfilling their fiduciary duty.

13:06Finance needs to partner with individual sectors to provide the means for society to achieve its objectives on the planet, people, and nature.

13:23There is an unprecedented opportunity for sustainable growth and impact in the climate transition.