From the Amazon rainforests to the Great Barrier Reef, WWF is making a difference
On every continent, they’re working to conserve the world´s biodiversity, restore natural habitats and species, and ensure that the use of renewable natural resources is sustainable.
To make its conservation work possible, WWF’s influence and expertise extends beyond the natural world and into the financial and government systems that affect it.
One specific area WWF is focusing on is the impact the financial sector has on our climate and on nature. Its sustainable finance team engages with the sector and advocates for the adoption of sustainable finance policies to reduce this impact.
Actions taken within the financial sector have a huge influence over how and where the money is directed. Sustainable finance is all about re-directing finance to support the projects and systems that will help our planet to remain healthy, rather than harm it.
How can financial services consider the planet?
“The financial system is the lifeblood of the economy,” explains Jérôme Crugnola-Humbert, director, sustainability services, Deloitte Switzerland.
“What is not financed or insured doesn't happen, and what insurers or banks end up financing and insuring – or not – ultimately has a great deal of impact on the physical world.”
Lending and Investment decisions have long-term environmental impacts, so it’s important to make sure money is invested in the right places sooner rather than later.
WWF’s sustainable finance work includes highlighting the potential benefits of investing and insuring more environmentally friendly projects and sectors which, while gathering momentum in parts of the financial world, is not happening quickly enough.
It’s a huge challenge and the change we want to see can only come from a global effort. But every journey must start somewhere.
To speed up progress, WWF has created a Sustainable Finance Regulations and Central Bank Activities (SUSREG) framework and database.
It’s a free interactive online tracking tool that regularly assesses how financial regulators, supervisors and central banks in 47 jurisdictions are integrating climate and broader environmental and social considerations in their policies and practice.
By demonstrating the value of nature and the link between financial and environmental risk, we aim to redirect the flow of finance away from activities that harm our planet toward those that generate sustainable economic, social and environmental benefits.
Maud Abdelli, Lead WWF Greening Financial Regulation Initiative
Leading by example
Bank Negara Malaysia together with the Value-based Intermediation Financing and Investment Impact Assessment Framework (VBIAF) working group has published ten guides for financing high-risk sectors including oil & gas, palm oil and construction. The guides include a suggested risk checklist during on-boarding assessments to determine the environmental and social risks of the clients.
The Banque de France (BdF) has decided to exclude any company working on new fossil fuel extraction projects from its portfolios by end-2024, after announcing in 2022 that it would exit coal entirely and strengthen its hydrocarbon exclusions.
A Guideline on the use of “Deforestation Risk Mitigation Solutions for Financial Institutions” was published by the Sustainable Finance Platform chaired by the De Nederlandsche Bank (DNB). The guide aims to provide financial institutions around the globe with actionable steps and specific services to analyse and mitigate their impact on deforestation.
Shifting finances towards sustainability
Deloitte’s regulatory strategy teams in Zurich, London, Australia and the US collaborated with local Deloitte offices in over 40 countries, bringing together each team’s regional expertise to provide an overview of the local ESG policies in the financial sector. This information fed into the WWF’s SUSREG tool, for use by financial institutions.
“Regulation is one of the most important tools that we have to address climate change. It’s a long-term project, and we can’t change the world overnight,” explains Linda Hedqvist, senior manager, EMEA centre for regulatory strategy, Deloitte UK.
“We are working to speed up progress and it’s been great to hear feedback from central bankers and financial supervisors in several countries telling us they’ll use it to influence their own policymaking agenda,” adds Jerome.
Supporting WWF’s SUSREG tool
WWF asked Deloitte to deliver support with the assessment of the 47 jurisdictions in the SUSREG framework and to broaden its scope from banking to the insurance sector.
WWF and Deloitte’s teams assessed countries against criteria such as whether banks or insurance companies had to disclose their climate risks, and if they were encouraged to stop financing or insuring coal or other carbon-intensive energies.
The project was initiated by WWF Greening Financial Regulation Initiative (GFRI) in 2021 with a first global annual report published.
We want to support banks, insurance companies and other financial institutions to better understand how to move towards a more sustainable future.
Jérôme Crugnola-Humbert, Director, Sustainability Services, Deloitte Switzerland
