On 21 September 2019, ahead of the UN Climate Action Summit in New York, Switzerland and the Netherlands will present an initiative on how public and private investments can be tested for climate compatibility and aligned with the Intergovernmental Panel on Climate Change's 1.5 °C target. The initiative is based on a successful pilot project in Switzerland.
In 2018, the Intergovernmental Panel on Climate Change (IPCC) showed that global warming must be kept below 1.5 °C if dramatic changes to ecosystems are to be prevented. This goal can only be achieved if global investments by public and private financial institutions are also geared towards meeting the 1.5 °C target.
On 23 September 2019, government representatives will meet for the UN Climate Action Summit in New York. In advance of the summit, on 21 September, Switzerland and the Netherlands will present an initiative in which the countries involved help their financial institutions to test their investments for climate compatibility in an internationally comparable way.
Using the PACTA (Paris Agreement Capital Transition Assessment) model, which has been globally tried and tested, participants can assess how much progress they have made in aligning their investments and financing with the IPCC’s 1.5 °C target.
The initiative is based on a successful pilot project in Switzerland. In 2017, pension funds and insurance companies in Switzerland were invited by the Federal Office for the Environment (FOEN) and the State Secretariat for International Finance (SIF) to have the climate compatibility of their investments examined. The next round of testing, beginning in 2020, will be coordinated with Denmark, Italy, Luxembourg, Norway, Portugal and Sweden, among other countries. The expanded model will then be available to asset managers and banks, in addition to Swiss pension funds and insurance companies.