Through the Climate Commitment, banks, pension funds, asset managers and insurers are contributing to the Paris Agreement and to the Dutch climate goals based on it. Realizing a good, long-term and responsible return for our clients and participants goes hand in hand with contributing to a liveable world.
On Feb. 10, the Financial Sector Climate Commitment Committee (CFSK) presented its progress report to Finance Minister Heinen and Climate and Green Growth Minister Hermans. In addition to measuring and reporting on CO2 levels and action plans, this report also addresses for the first time the sector's efforts to finance the energy transition.
"There is a broad undercurrent in the Netherlands that wants to continue on the path we have taken with the climate," states Peter Blom. To achieve the long-term goal of "net-zero" by 2050, the financial sector is eager to intensify cooperation with the government. Good cooperation between public and private parties is of increasing importance in the current geopolitical situation. Climate change remains a risk both economically and ecologically. The sector therefore advocates a framework of agreements in favor of effective cooperation, such as formulating guiding sector goals, standardizing and pricing emissions and subsidizing sustainable innovations and complex transitions that the real economy cannot bear (alone).
Financing energy transition
The term transition finance has not yet been uniformly defined, and the indicators for measuring its contribution vary among institutions. This report attempts to reflect the contribution made by financial institutions to the energy transition. For example, at the end of 2023, participants reported assets on their balance sheets and/or asset management totaling 56 billion in solar and wind energy projects, 72 billion in renewable mortgages, and 23 billion in energy infrastructure. The CFSK will be firmly committed to financing the energy transition by working with Invest-NL on financing transition sectors in the form of financing tables. These aim to stimulate private financing for the climate and energy transition.
Funded emissions and action plans.
Financial institutions are reporting carbon emissions for an increasing proportion of portfolios. In 2023, emissions were measured for 83% of the sector's total portfolio. This is an increase of 15 percentage points from 2022. In addition, the measured scope 1 and scope 2 emissions show a decrease of about 5%. This decrease is partly explained by measures in institutions' action plans to achieve emission reductions in their portfolios. Caution should be exercised in drawing conclusions about a possible trend in reported emissions based on the measured data because it is difficult to trace which measures have had an impact on the balance sheet and indirectly on the real economy.
Work is currently underway to revise the current guidance with the goal of bringing the reporting in line with sustainability reporting legislation, improving comparability and thereby increasing visibility.
The progress report, cover letter to the minister and more information can be found here.
This is a joint press release from DUFAS, Dutch Banking Association, Pension Federation and Association of Insurers
