In the context of Development Finance Institutions’ (DFIs) efforts to mobilise private sector capital in support of the UN Sustainable Development Goals (SDGs) and the Paris Agreement, this document explore the progress to date from the perspective of private sector banks and focus, among others, on how banks choose to align their operations with the SDGs and the nature of the relationship that banks have with DFIs.
This document points out that, in order to effectively couple climate financing with strong and measurable sustainable development criteria, there is a need to move beyond carbon as a standalone tradeable commodity, by increasingly valuing the significant range of additional ecosystem and socio-economic services provided by sustainable agriculture practices and programmes that simultaneously address climate concerns and sustainable rural development priorities. Based on lessons learned from the current climate policy process — where agriculture has played to date a too minor role — this paper examines how stronger sustainability criteria and a wider focus on payment for ecosystem services can provide the pathway to significantly increase the amount of climate financing directed towards the agricultural sector for sustainable development
For this transition to happen, and in order to scale up climate finance for agriculture to the levels necessary to implement effective action in developing countries, this paper argues that agriculture should be explicitly included in future climate mechanisms, by expanding the range of currently available methodologies and by simplifying, monitoring, reporting and verification approaches.
