Coordinating Global Risk Mitigation for Exponential Climate Finance

This report, published by the Climate Governance Commission and the Global Challenges Foundation, examines key issues regarding climate financing including what is required to implement climate pledges, the massive gap between this and what is actually being provided in climate financing, and how to bridge this gap including through better governance mechanisms for climate financing.

The report calls for four shifts in the approach to climate financing to help bridge this gap. These shifts relate to scale, regulation, balance, and risk:

• Capital is needed at a far greater scale than what has been negotiated;
• Regulation in developing countries must create an ecosystem for green finance;
• There must be balance both between public and private sources, and between mitigation and adaptation needs;
• Investment risk in relation to emerging markets and developing nations needs attention, otherwise green finance remains limited and costly.

The report proposes the establishment of a Global Clean Investment Risk Mitigation Mechanism (GCI-RMM) to reduce the cost of capital, increase international private investment, and strengthen the policy and regulatory systems in developing countries in order to attract clean investment at scale.