Discussions on Climate Financing Highlight Importance of Sustainable Projects

The Guernsey Sustainable Finance Seminar took place in London, focusing on vital topics surrounding climate financing.

Key discussions revolved around insuring climate risks, the mechanics of carbon pricing, and the need for securing capital for sustainable projects.

Emmanuelle Bury, the UK Country Head of BNP Paribas, delivered a keynote address.

“We are not just fighting for global warming, but our entire model of society,” she said. She stressed the urgency for the finance industry to adapt or risk regression to a state of poverty as climate change and food security become increasingly dire.

Bury highlighted Guernsey's role in sustainable finance.

“Guernsey has reached success in just 50 years by making sure that it is always ready to accommodate the changing needs of the industry, financial services and society at large, and it has been very successful in doing so.” Ana Haurie, Co-founder and CEO of Respira International, discussed the substantial business case for investing in climate initiatives.

“Where we can get most bang for our buck is in nature-based solutions, most of which are in the global south.”

Respira's involvement aims to restore and protect nature through projects that generate carbon credits for sale to businesses.

The need for increased transparency in reporting was a recurrent theme.

Amy Lazenby, Senior Investment Director at Close Brothers Asset Management, said:“In order to attract more sustainable capital, we need to increase transparency and show that the returns match what you can get elsewhere.”

She expressed optimism regarding the long-term prospects for investments in nascent sustainability classes, despite current difficulties linked to rising interest rates.

Discussion also touched on the necessity for regulatory frameworks to support capital flows, with Haurie saying: “Regulation shouldn’t be voluntary, it should be mandatory. That is what will unlock the demand and capital that is required.”

Ruth Murray, Investment Director at Gresham House, pointed out that Guernsey's strategic regulatory approaches have catalysed investments beyond renewables, including projects aimed at digital inclusion and waste management solutions.

She noted that national mandates, like the UK Government's Biodiversity Net Gain requirements, play a crucial role in shaping investment strategies.

The seminar also examined the role of insurance markets in developing risk management products to support emerging markets.

Mike Pickard from Aon shared insights into his work on the world’s first humanitarian catastrophe bond, which operates on a parametric basis. He described this $3 million bond as a “proof of concept” for how the insurance industry can engage with climate risks, noting that scarcity of donor funds could inhibit broader applications.

Guernsey continues to strengthen its position as a leader in sustainable financial solutions, as illustrated by Stephanie Glover, Guernsey Finance's Strategy and Sustainable Finance Director, who stated, “Guernsey was the world’s first jurisdiction to launch a regulated green fund regime, the Guernsey Green Fund (GGF) designation, in 2018, with a Net Asset Value of £5.1 billion.”

Glover underscored the importance of such regimes in directing capital to climate and nature-positive projects.