Around the world, climate change poses a systemic risk to economies and societies, leaving countries exposed to shocks that hinder their sustainable development. Across Asia, financial systems remain vulnerable to such risks, particularly as they lack the institutional capacity to manage increasing climate risks and the strong, sustainable financial frameworks that can unlock the trillions in investments needed to achieve their climate and sustainability goals.
Transitioning to more sustainable and greener financial systems in this region is key to building a more resilient finance sector. While UK PACT has already supported initial steps in this direction, more work is needed to fully incorporate climate concerns into financial policies and regulations and, at the same time, mobilise further private finance into green investments. The development of sustainable financial architecture and products also provides an opportunity to enable a more inclusive financial system, by encouraging banks and local financiers to provide green finance to marginalised communities, including female entrepreneurs and small-scale farmers, who are often ineligible for traditional finance options.
Applications for the Expressions of Interest closed on 13 June 2022. The scheme is not currently accepting new applications, but by signing up for updates you will be kept informed about future funding rounds.
The transition to greener financial systems starts with a focus on public budgets and macroeconomic policy – working with finance ministries, central banks, and regional administrations to incorporate climate concerns into financial decision-making. Mobilising private finance is also crucial for directing investments towards projects and technologies that contribute to achieving net-zero goals and a just transition.
Support is essential to help countries develop financial frameworks, risk management tools, and financial instruments that in turn will increase green finance flows to support both climate and social inclusion objectives – improving access to finance for small businesses, women, and people from vulnerable groups.
Asia (India, Malaysia, Thailand, Vietnam)
Latin America (Argentina, Brazil, Peru) and Asia (Bangladesh, India, Indonesia, Thailand, Vietnam)
Developing financial market frameworks for sustainable finance that incentivise investments into green and sustainable projects
Aligning climate risk reporting and management mechanisms with international standards (such as the recommendation from TCFD2 or the prototype requirements from the new ISSB3), to help build resilience against climate-related physical externalities
Mainstreaming sustainability in public budgets and implementing reforms to embed climate dimensions in national public financial management systems
Supporting governments to design innovative financial architectures and more ambitious national strategies to scale-up sustainable finance
Supporting governments and financial institutions in designing policies and financing options, to support more inclusive financial systems (e.g. gender-sensitive monetary and regulatory policies, new financial offerings for qualified beneficiaries, establishing local green funds, etc.)
Developing a pipeline of green/sustainable investible projects
Providing direct funding to green/sustainable projects outside the financial sector
For previous funding rounds, the following documents were used to describe the theme in detail in both Portuguese and Spanish. The same information can be found on this page in English.
