EIB Vice-President Ambroise Fayolle delivered the opening speech of the Joint MDB event on Paris Alignment progress update at COP28 on 8 December. 

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Ladies and Gentlemen,

Welcome to this annual COP event of the multilateral development bank (MDB) community where we collectively report on the progress we’ve made towards Paris Alignment and our next steps.

As many of you remember, in December 2018 at the COP24 in Katowice, we MDBs announced a joint framework to  align our activities with the goals of the Paris Agreement. Let me tell you about the importance of this approach, which is built around six building blocks.

We won’t reach a low carbon and climate resilient future unless finance flows are aligned with the temperature and adaptation goals of the Paris Agreement.

Embedding both mitigation and adaptation in all our operations is therefore the essence of building blocks 1 and 2.

With both mitigation and adaptation in mind, and with equal importance, we have to look at all types of new operations. At the European Investment Bank Group we started doing this at the beginning of 2021, with our low-carbon framework. This was based on the early MDB approach at the time and involved screening all projects for physical climate risks. Building on our experience and those of other MDBs, we published this year our Joint MDB Methodological Principles for Assessment of Paris Agreement Alignment for new operations, and I am sure you will hear more about that from all the MDB colleagues here.

But building blocks 1 and 2 also require us to assess and manage climate risks in our existing portfolios, which is an important topic also being addressed through the Taskforce on Climate-Related Financial Disclosures and the latest reporting standards. For us as public banks – whenever we identify a risk, we are identifying a risk to our clients and to their projects and assets. Our task, in such cases, is therefore to see how we can support our existing portfolio of clients. Our job is not to disinvest – but to help our clients transition. Our role is not to avoid physical climate risks – but to help our clients reduce and avoid those risks.

Building Block 3 is about climate finance. This is a key issue and one of the main topics at this COP. MDBs have long had a focus on Climate Finance. Last year, we reached a record of nearly $100 billion globally (up from $82 billion in 2021) with a majority, $61 billion, dedicated to low and middle-income countries. Climate Finance, particularly the mobilisation of private finance, will remain a core part of our whole Paris alignment approach.

I mentioned earlier that this work is primarily about helping our clients. Our fourth building block Engagement and policy development support is critical in this respect.  Building on our  High-Level Principles for Just Transition  as well as on Common Principles for LTS support, MDBs will remain focussed on supporting countries and all our other clients, both public and private. We have achieved good progress in this area. Most importantly, we were delighted to announce just a few days ago the joint Long-term Strategy Programme. This programme will help developing countries and other public sector clients prepare and implement long-term climate strategies that address the transition to a low-carbon economy as well as build climate resilience and address the social aspects of these transitions.

Of course, if you really want to help your clients, you should also set a good example and put your own house in order. This is why Building Block 6 on aligning internal activities – is a stand-alone building block in our approach. MDBs have been working together closely on this, exchanging ideas and comparing experiences. By working on our own internal Paris alignment, we learn how we can better help our clients on their journeys.

Finally, let me make a point about transparent reporting. Which is Building Block 5. We are all now well on the road to implementing our Paris alignment framework and we need to think about the way we will be reporting in the future. Over the past few years, we have seen the development of global sustainability reporting standards (ISSB, ESRS…). And we have given indications at previous COPs on how our joint MDB reporting framework might look. We are continuing this work and will be hosting an event to discuss Paris Alignment Reporting here in a joint MDB event in 2 days time. At this COP, we are also committing to look more into the results, outcomes and climate impact of our work, as well as reporting on our volumes of climate finance.

We at the EIB Group, set out to operationalise all the 6 MDB Paris alignment building blocks in November 2020 as part of our Climate Bank Roadmap 2021-2025. We found that by applying the 6 Building Block framework, we were able to operationalise Paris Alignment across the whole EIB Group. Of course, each MDB has to operationalise the different building blocks in their own way and in line with their mandates. But what is really important is that MDBs as a group continue to share their experiences among each other and with others. By doing so, we can all progress faster together.

In this spirit, we look forward to telling you today where we are collectively in this journey and to sharing our experiences with you and outlining what we see as the way forward. With this, let me hand you over to the MDB climate heads to take you through the presentation.