Coalition of Finance Ministers for Climate Action Meeting
The Coalition of Finance Ministers for Climate Action – established in Washington DC in April 2019 on Finland’s initiative – brings together fiscal and economic policymakers from over 50 countries in leading the global climate response and in securing a just transition towards low-carbon resilient development.
Speech by ICC Secretary General John W.H. Denton AO on the margins of the World Bank Group/International Monetary Fund 2021 Spring Meetings
Tuesday, 6 April 2021, 10:54-11:19 (ET)
Session 3 – Making Progress Towards Decarbonization: Dialogue with Key Stakeholders
The global business community stands squarely behind collective efforts to limit global temperature increase to 1.5°c.
The science is clear. The long-term economic argument is compelling.
- But how do we unlock that opportunity to the fullest possible extent?
- How do we enable all businesses to take action aligned with a net-zero future?
- And that, means “enabling the global sme ecosystem to deliver at scale”
- MSMEs make up almost 90% of businesses worldwide.
- Employ more than two billion people and are the foundation of the global economy.
- They also account for more than 50% of GHG emissions.
- But MSMEs are an afterthought when it comes to global discussions on climate action.
- It’s time to reframe the debate.
- MSMEs are the lynchpin in any economy-wide transition to net zero.
- Enterprising SMEs can also drive the innovation needed to meet the climate challenge – across renewable energy, hydrogen, carbon removal and zero-emission mobility solutions.
- MSMEs see quite clearly the need to take effective climate action – now !
- Witness the extraordinary commitment of millions of SMEs to the ICC Chambers Climate Coalition
But MSMEs are often unable to align with the goals of Paris
At this point in time SMEs are struggling just to get by – rather than thinking about investing in a greener future.
- This roadblock to a real economy approach to climate action will be all greater following the economic shock caused by the pandemic.
- Expecting MSMEs with increasingly weak balance sheets – and increasingly pessimistic views of their futures – to voluntarily make the investments needed to reduce their emissions footprint, or boost their resilience to a changing climate, just isn’t realistic
- That’s why – we launched last September the SME Climate Hub, to provide a positive incentive to change.
- To provide a central platform to way to make climate action a commercial opportunity for all SMEs everywhere.
- Don’t understate the costs that companies can incur in making the transition to a low-carbon trajectory throughout their operations…
- Which is why we are partnering with multinational companies to provide clear procurement preferences and preferential financing opportunities to MSMEs that have made a recognised net-zero commitment.
But that is only one part of what is needed…
Effective government policies to incentivize MSMEs to invest in a net-zero future are just as important.
– We urge this coalition to commit to a comprehensive suite of fiscal interventions to align fiscal and market signals with our shared commitment to ambitious climate action.
- This should, in our view, include:
- Efficient and cost-effective SME-friendly carbon-pricing instruments – and by using the proceeds of such interventions to support SMEs in their climate efforts.
- Improved access to finance for MSMEs with clear climate targets and strategies through strengthened loan guarantee schemes.
- Accessible and consistent frameworks to enhance MSME climate-related financial disclosure.
- Broadening the scope of global banking and regulatory mandates to incorporate climate and sustainability related risks and objectives.
- And, including MSMEs in climate policy development and implementation.
- ICC stands ready to serve as the MSME focal point in any way we can.
We encourage you to work with us
To remove the obstacles SMEs face in aligning their operations with the Paris Agreement…
Visit the SME Climate Hub