What is UNEP FI?
The United Nations Environment Programme Finance Initiative (UNEP FI) is a network of banks, insurers, and investors that works to catalyze action across the financial system to foster a more sustainable global economy.
UNEP FI's Principles for Responsible Banking and Principles for Sustainable Insurance, along with three UN-convened net-zero alliances, are implemented by more than 450 banks and insurers with assets exceeding $100 trillion. As part of this initiative, financial institutions are assisted in setting and implementing sustainability targets, implementing global frameworks, and advancing knowledge and practice in the following key areas:
- Climate change: Through the development of research and guidance, UNEP FI assists financial institutions in understanding and addressing the risks and opportunities associated with climate change. In addition to supporting the Paris Agreement, their goal is to assist the finance sector in playing a role in facilitating the transition to a net-zero global economy.
- Nature: UNEP FI is committed to integrating sustainable decision-making into mainstream finance, with a special focus on nature and biodiversity. They provide technical research, guidance, and
cutting-edge innovations that assist banks, insurers, and investors in identifying and reducing their impact on natural resources. These initiatives include Nature Risks & Financial Disclosures, Biodiversity Targets, and Ocean, Forests & Food.
- Pollution & Circular Economy: UNEP FI has implemented several initiatives to address pollution and transition to a circular economy, particularly on plastic pollution and circular solutions. They engage the global financial sector to increase the financing of pollution-free and circular solutions. UNEP FI engage the finance sector in research, guidance, raising awareness, building capacity within the financial community, and facilitating peer exchange and collective action at both the global and regional levels.
- Sustainable Development Goals (SDGs) & Impact: Through collaboration with its members and other sustainability initiatives, UNEP FI aims to close the $2.5 trillion gap in SDG funding by mainstreaming impact analysis and management in business and finance. A series of tools and resources have been developed for holistic impact management and the Principles for Positive Impact Finance, which provide a high-level framework for the finance sector to analyze and manage impact across the economy.
- Social & Human Rights: To contribute to a just transition and to the 2030 Agenda principle of leaving no one behind, UNEP FI
incorporates social and human rights considerations into mainstream finance. According to them, the "three planetary crises" of climate change, biodiversity loss, and pollution have resulted in increased human rights concerns and social inequalities, particularly for marginalized groups.
Among UNEP FI's most notable achievements are as follows:
- UN-convened net-zero alliances:
- The Net-Zero Asset Owner Alliance is a network of institutional investors committed to transitioning their investment portfolios to net-zero greenhouse gas (GHG) emissions by 2050, with intermediate targets for CO2 reduction set for 2025 and 2030.
- The Net-Zero Banking Alliance is an industry-led initiative of global banks representing over 40% of global banking assets, with the goal of aligning their lending and investment portfolios with net-zero emissions by 2050, with intermediate targets set for 2030 or sooner.
- There are 29 leadinginsurers in the Net-Zero Insurance Alliance, representingapproximately 14% of world premium volume. They have committed themselvesto transitioning their insurance and reinsurance underwriting portfoliosto net zero greenhouse gas emissions by 2050 to contribute to theimplementation of the Paris Agreement.
- UN Principles for Responsible Banking: With over 300 signatory banks, the UN Principles for Responsible Banking is a sustainable banking framework that aims to accelerate a positive global transition. The principles include:
- Alignment with the UN Sustainable Development Goals, the Paris Agreement, and relevant national and regional frameworks,
- Impact and target setting to increase positive impacts and reduce negative impacts on people and the environment,
- Responsible work with clients and customers to encourage sustainable practices,
- Proactive consultation, engagement, and partnership with relevant stakeholders,
- Effective governance and a culture of responsible banking and
- Transparency and accountability for positive and negative impacts and contribution to society's goals.
- UNEP FI Principles for Sustainable Insurance: The UNEP FI Principles for Sustainable Insurance is a globally recognized framework for addressing environmental, social, and governance risks and opportunities in the insurance industry. The initiative seeks the development of Environmental, Social, and Governance guides for insurers as well as work supporting the implementation of the recommendations of the Task Force on Climate-related Financial Disclosures. Sustainable insurance is a strategic approach where all activities within the insurance value chain, including interactions with stakeholders, are conducted in a responsible and forward-looking manner.
- Investment Leadership Programme: Small groups of responsible investors are brought together to incubate ambitious initiatives. Additionally, the initiative enables investors to collaborate with UNEP FI's bank and insurer network and connect them with policymakers to initiate change across the industry. In addition to the convening power of the United Nations, investors will have access to the insights and resources of the UN Environment Programme and the PRI's history of engaging investors on environmental, social, and governance issues.
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