Liechtenstein Bankers Association

By Simon Tribelhorn

Without the past, there is no future. Tradition is important – especially for banks like ours, given that they pursue a long-term, cross-generational approach in all their thought and action. But we cannot rest on the laurels of our past. In other words: Tradition must not mean that we unconditionally stick to what we’ve always done, without constantly questioning ourselves and our surroundings. We need a good mix between the proven and the new – between tradition and innovation.

This is why, together with our member banks, we have developed our new multi-year strategy, Roadmap 2025. Its leitmotif is “Growth through innovation and sustainability”, deliberately placing an even greater emphasis on sustainability than we already have in the past. The goal is for the banking centre to play a crucial and creative role shaping the so urgently needed transformation of the global economy and society towards greater sustainability and to achieve a real impact with our products and services for the benefit of our clients and future generations. We strive for a comprehensive approach to sustainability, whereby the 17 Sustainable Development Goals of the United Nations not only serve as guiding principles, there is a strong business imperative to deliver them. The recent ‘Better Business, Better World’ report revealed that pursuing sustainable and inclusive business models could unlock economic opportunities worth at least US$12 trillion a year by 2030 and generate up to 380 million jobs, mostly in developing countries. Hence, we do this knowing that our clients expect more than simply high-quality services. Our clients also want financial institutions to contribute to solving the environmental and social challenges of our time. Are we on the right track? – Yes, we think so, but we are aware that much remains to be done. And again speaking for Liechtenstein banks, especially in our core business – investment advice and asset management – our range of products and services must be swiftly further expanded.

The coronavirus pandemic has caused us all – including investors – to reflect more deeply about the future. The focus has shifted dramatically towards health and security, and sensitivity about one’s own financial security in the future has noticeably increased. The slowing down of our everyday lives has led to a speeding up of sustainable investments. A change in thinking can be seen in society, politics, and business: Energy companies like Total and BP are looking for new, sustainable business models, and even traditional car producers are converting their entire fleet to e-mobility; the German Bundestag is holding general parliamentary debates on sustainability; and Austria has set out a clear objective in its current government programme 2020-2024 to become climate-neutral by 2040 and to invest in sustainability, to name just a few examples.

In addition to sustainability, we must also incorporate the opportunities and risks of digitalisation in a meaningful way. COVID-19 has shown us this impressively as well. In particular the way we work, and above all where we work, changed significantly during the coronavirus pandemic. Up to 90% of the employees of our financial institutions had to work from home and in some cases still do. The coronavirus did not invent the home office, but it dramatically accelerated an existing trend. What was unthinkable just a few months ago has suddenly become reality and will become an integral part of our everyday life in the future. In the medium to long term, neither employees nor employers will want to – or be able to – completely do without the advantages of working from home. Hybrid forms or the “flexible office” are likely to dominate after the coronavirus.

In any event, three questions relating to this new world of work will occupy

us in the banking sector for quite some time. Firstly, what impact will these developments have on corporate culture. At the latest since management guru Peter Drucker, we have known that culture eats strategy for breakfast. This spirit is strongly influenced by interaction among employees. Atmosphere, personal exchanges, and joint activities help shape identity. In the “flexible office”, where everyone is hardly ever on site at the same time, these drivers are missing. As a consequence, culture must be rethought and put into practice differently. Secondly, personalised services and support for our clients continue to be of vital importance, especially in the core business of our member banks, asset management. Only the future will tell to what extent this will still go hand in hand with interactions in person and on site. Clearly, younger generations are more mobile, digitally savvy, and used to virtual interactions. At the same time, they expect more than merely customer care; they desire customer experiences. For the service industry in general and banks in particular, the challenge will be to remain relevant to tomorrow’s customers and to create traceable and measurable added value in a digital world. And last but not least, the “war for talents” is likely to intensify. Qualified personnel will continue to be scarce, especially for a small country like Liechtenstein, which is dependent on workers from abroad. Companies will be challenged to offer employees tailored working models that are optimised to their work and objectives and that both create attractive jobs and ensure business success.

In Roadmap 2025, we have addressed these and other questions relating to new worlds of work and defined concerns and measures to become fit for the future in this area as well. As outlined, digitalisation and sustainability go hand in hand. For example, digitalisation also leads to less intensive use of our overburdened infrastructure, which not least of all benefits the climate. And so we come full circle, showing that a comprehensive approach to sustainability makes absolutely sense. ◆

Established in 1969, the Liechtenstein Bankers Association is the domestic and international voice of the banks operating in and out of Liechtenstein. It is one of the country’s most significant associations and plays a key role in the successful development of the financial centre. Member interests are pursued in accordance with the principles of sustainability and credibility. As a member of the European Banking Federation (EBF), the European Payments Council (EPC) and the European Parliamentary Financial Services Forum (EPFSF), the Liechtenstein Bankers Association is a member of key committees at the European level and plays an active role in the European legislation process. Since 2017, the LBA has also been a member of the Public Affairs Council (PAC) with offices in Washington and Brussels and since 2018 of the international network ‘Financial Centres for Sustainability’ (FC4S).

Registered in the EU Transparency Register with number: 024432110419-97

bankenverband.li https://www.bankenverband.li/en/ bankers-association/roadmap-2025

more than a year since the COVID-19 pandemic started. Even now, as multiple countries recover and the pace of the vaccination drive increases, the state of the global economy remains vulnerable and requires strong leadership to fully recover and rebuild. This is why we at EUROCHAMBRES believe that this year’s G7 must demonstrate that it can deliver a progressive vision for the business community, and firmly advance the global agenda in areas that reflect our shared values and interest as likeminded partners.

United against rising protectionism and unfair trade As we are currently seeing with a scarcity of certain raw materials, and bottlenecks in the logistics sector, the COVID crisis continues to pose enormous challenges for our highly interconnected economies. A pandemic requires global solutions to tackle the challenges effectively. However,, it is more important than ever for the G7 nations to lead the way in creating a predictable and forward-looking trading environment for the post COVID era, pushing back decisively against rising protectionist tendencies that risks undermining our nascent recovery.

At the same time, the G7 Summit is an excellent occasion to strengthen our collective resolve in addressing unfair trading practices on the global stage. Issues such as forced technology transfers, or injurious subsidization have too often led to global overcapacities and consequent hardship for companies in all G7 economies. The lesson from this should be that we are better off acting together than individually, and we believe this spirit must guide our actions as a G7 in the months to come.

Boosting fair and open trade will not only play a key role for the pace and effectiveness of our recovery, but it will also strengthen G7 efforts in creating more sustainable and resilient supply chains post COVID. Global trade has proven to be an extremely valuable driver of growth that must be fully harnessed for our recovery, particularly for our SMEs, as they rely on access to global markets and global value chains for the innovation, growth and resilience of their business. In this

sense, within the EU alone in 2017, international trade has secured over 36 million jobs, with every additional billion EUR traded creating 13.000 jobs on average within the EU.

It is with this in mind that we as Chambers stand for open, fair and inclusive trade, and why urgent action is needed among the G7 to halt and roll back the protectionism that is affecting ever more important areas of the European economic fabric, and arguably ever more important fields in the economic fabric of all G7 countries. Restoring predictability, reducing barriers to trade and creating a level playing field – as has been discussed vividly in the lead-up to the Carbis Bay Summit - must therefore be a cornerstone of a more coordinated G7 agenda to global trade.

Strengthening the multilateral trade system Strengthening rules-based trade on the global stage must also be a priority for the G7. As EUROCHAMBRES and the associated Global Chamber Platform (GCP), we have also long advocated for the need to fully restore the functionality and effectiveness of the World Trade Organization (WTO). To that end, we must urgently make progress, if necessary, among a coalition of willing countries first, to update and re-invigorate global trade rules, in order to make them fit for contemporary business challenges. →

→ This goes for rules on digital trade, services liberalization, but also with respect to more transparency from all WTO members. In this sense, EUROCHAMBRES has suggested creating annual public reports that mirror the World Bank’s “Doing Business Report” to track performance and compliance with WTO commitments in a much more open and visible way. Above all however, we urge G7 leaders to sketch a credible path towards swiftly reappointing officials to the Appellate Body, as there can be no predictability in global trade without proper adjudication and enforcement.

Furthermore, we believe policy makers globally and in the G7 in particular must do more to integrate SMEs better in global trade post COVID. As EUROCHAMBRES, we have therefore called for an ambitious SME agenda at the WTO, and this should be a priority for all G7 countries as part of their WTO reform agenda in order to support them in re-connecting with the world.

A clear digital global vision for our recovery In light of the increasing digitization of world trade, it is also vital for the G7 to champion the future-proofing of trading rules, with particular attention on new digital technologies and future developments. The cross-border flow of data should not be impaired unduly among our economies; intellectual property and know-how should be better protected, and we should work together on aligned future standards in emerging technologies. We should be vigilant that digital or technological sovereignty will not be construed to mean striving for economic, technical, or scientific self-sufficiency, or to justify discrimination in the terms of market access. On the contrary, as a group of G7 countries, we should strive for common approaches, shared ideas and increased cooperation where possible to harness the potential of the digital transition.

At the same time, with the rapid digitalization of the economy, we must pay special attention to ensuring that our workforce is well equipped for the new work environment. Digital skills will be essential, yet there is a large gap between the demands of the labour market and the available supply of talent. 90% of future jobs will require digital skills and digital literacy, yet a sizeable segment of the population does not currently possess such skills. This illustrates the pressing need to provide adequate training opportunities to our workers as we emerge form the crisis. The G7 should therefore ensure that employment will not be outpaced by the new digital age – for instance by putting the focus on specific training opportunities and scope for collaboration in the areas of artificial intelligence, big data, and other emerging professions in the digital economy. The sooner the G7 leadership can present a common vision, the sooner the private sector will be able to provide practical solutions for its implementation.

The green transition needs coordination Lastly, the transition towards a more sustainable global economy is a priority for EUROCHAMBRES, as it is for the European Union as a whole. COVID presents an opportunity to build back better and greener. The European reen Deal underlines the scale of transformation that large parts of the European economy will undergo. European businesses are already world leaders in many green technologies as well as in the transition towards circular economies. With other key players in the G7 following a similar path, it will be essential to secure increased coordination among our economies, as well as with our global partners in order to minimize any potential disruption for our businesses. The high level of ambition regarding international commitments to climate neutrality within the G7 is already a welcome and positive step towards that aim.

It remains critical however, that the G7 also ensures the right supporting measures and conditions for the green transition by striking the correct balance between financial incentives and regulation. Moreover, given SMEs will need additional support, we must also pay close attention that the administrative burden to implement regulations and access to funding are coherent, proportionate, and easy to implement for all companies.

This G7 is taking place in a context like no other. Leaders need to rise to the occasion if our economies are to embark on a global recovery like no other and our businesses are to be enabled to build back better. ◆

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A statement by the UK Presidency of the G7

to the UNFCCC COP26 meeting in Glasgow in November, this statement - issued by the UK as G7 Presidency, and incoming Presidency for the UN Framework Convention on Climate Change (UNFCCC COP26) in Glasgow, in partnership with Italy - takes stock of new climate and nature commitments made by G7 members and partner countries who attended the Carbis Bay Summit on 12-13 June 2021. In line with the Paris Agreement, the Presidency notes that developed country parties should continue taking the lead by undertaking economy-wide absolute emission reduction targets and in mobilising climate finance to support developing countries in their mitigation efforts and adapting to the impacts of climate change.

During their meeting in Carbis Bay, the Leaders of the United Kingdom, Australia, Canada, the European Union, France, Germany, Italy, India, Japan, the Republic of Korea, South Africa, and the United States discussed the interdependent challenges of climate change and biodiversity loss that threaten nature, people, prosperity and security. They were joined by heads of the UN, International Monetary Fund, World Bank and OECD along with Sir David Attenborough, COP26 People’s Advocate, who called on Leaders to take urgent action to avoid environmental crises:

The discussion recognised this and highlighted that 2021 is a critical year of international leadership towards achieving a sustainable future, looking forward to the UNFCCC COP26 in Glasgow and the UN Convention on Biological Diversity (CBD) COP15 in Kunming. As the Prime Minister has said:

to help them do so.” →

→ Supporting COP26 Presidency goals Reflecting on the COP26 Presidency goals, the Prime Minister invited partners at the meeting to set out the specific actions they are taking to drive a global green transition both in their own economies, and to support developing nations on a path to reaching net zero.

GOAL 1:

Ahead of COP26, the UK COP Presidency is calling on all countries o come forward with ambitious 2030 emissions reductions targets (Nationally Determined Contributions (NDCs)) that align with reaching net zero by the middle of the century. To deliver on these stretching targets countries will need to: accelerate the phase out of coal; curtail deforestation; speed up the switch to electric vehicles; and encourage investment in renewables.

At the Carbis Bay Summit, Leaders discussed the global imperative of holding the increase in the global average temperature to well below 2 degrees above pre-industrial levels and to pursue efforts to limit the temperature increase to 1.5 degrees above pre-industrial levels, recognising that this would significantly reduce the risks and impacts of climate change. Recognising that the path would look different for each country, as well as the specific challenges faced by developing countries, particularly those most vulnerable to the impacts of climate change, Leaders acknowledged the collective effort needed to significantly reduce emissions during this decade and reach net zero global greenhouse gas emissions as soon as possible in order to keep the temperature goal of the Paris Agreement in reach.

Beyond the collective commitments made by G7 Leaders, as detailed in the Carbis Bay G7 Summit Communique, the United Kingdom has reaffirmed its commitment to reduce emissions by at least 68 per cent by 2030 and by 78 per cent by 2035 from 1990 levels. Australia has reaffirmed its intention to overachieve on its 2030 emissions reduction target of 26-28 per cent below 2005 levels, and to release its LongTerm Strategy ahead of COP26. Canada has reaffirmed its commitment to reduce emissions by 40-45 per cent by 2030 from 2005 levels. The European Union has reaffirmed its commitment to reach climate neutrality by 2050 and to a Union-wide target of reducing net emissions by at least 55 per cent by 2030 from 1990 levels. France has reaffirmed its commitment to reduce emissions by 40 per cent by 2030 from 1990 levels. Germany has reaffirmed its commitment to reach net zero by 2045 and to reduce emissions 65 per cent by 2030 from 1990 levels. Italy has reaffirmed its commitment to reduce emissions by 33 per cent by 2030 from 1990 levels. Japan has reaffirmed its commitment to reduce emissions by 46 per cent in FY2030 from FY2013 levels while continuing to take on a challenge to aim at the goal of cutting emissions by 50 per cent. The Republic of Korea has reaffirmed its commitment to achieving Net Zero by 2050 and to release an updated NDC at COP26. The United States has reaffirmed its commitment to its updated NDC target of 50-52 per cent emissions reduction in 2030 below 2005 levels.

In their discussions in Carbis Bay, Leaders were encouraged by the accelerated deployment of renewable and clean energy technology. In his address, Sir David Attenborough highlighted coal power generation as the single biggest cause of global temperature increases and, in that context Leaders discussed the need to further accelerate the transition away from unabated coal capacity and to an overwhelmingly decarbonised power system, and noted the differential phase out dates for developed and developing countries set out in the International Energy Agency’s ‘Net Zero by 2050’ report, published in May 2021. Leaders also recognised the importance of sustained policy support and investment to promote green growth and address climate change in their recoveries. In line with the Paris Agreement, Leaders noted in their discussions the imperatives of a just transition of the workforce and the creation of decent work and quality jobs in accordance with nationally defined development priorities so that no person, group or geographic region

is left behind. Beyond the collective commitments made by G7 Leaders, as detailed in the Carbis Bay G7 Summit Communique, the United Kingdom has reaffirmed its commitment to phase ut unabated coal power by 2024, committed to end in 2021 direct international government support for fossil fuels, and committed to phase out petrol and diesel vehicles by 2030 and hybrids and plug-ins by 2035. Canada has reaffirmed its commitment to phase out unabated coal power by 2030, and also reaffirmed its commitment to no new financing for thermal coal plants, mines, or infrastructure abroad and confirmed that new or expanded thermal domestic coal mining does not align with Canada’s climate plan. The European Union has reaffirmed its commitment to an immediate end to all financing of new coal infrastructure in third countries. France has reaffirmed its commitment to phase out unabated coal power by 2022 and reaffirmed its commitment to end direct international government support for oil by 2025 and for gas by 2035. France has also reaffirmed its commitment to end the sale of new petrol and diesel vehicles by 2040. Germany has reaffirmed its commitment to phase out unabated coal power by 2038 at the latest and committed to an electric vehicle uptake target of 7-10 million by 2030, and has introduced a price on all emissions from the combustion of heating oil, natural gas, petrol and diesel. Italy has reaffirmed its commitment to phase out unabated coal power by 2025, and committed to electric vehicle phase-in targets of 4 million by 2025 and 6 million by the 2030s. India has reaffirmed its commitment to install 450GW of renewable energy by 2030 and reaffirmed the commitment for Indian Railways to become net zero carbon emissions by 2030. Japan announced a commitment to end direct new government support for unabated international thermal coal power generation by the end of 2021 and has committed to a target of full electrification in new passenger car sales by 2035. The Republic of Korea has joined the G7 in committing to stop public financing for new overseas coal fired power plants. South Africa has noted its aim to reduce dependence on coal from 89 per cent of its energy structure currently, to 59 per cent by 2030. The United States has committed to a domestic goal of Net Zero in the power sector by 2035 and to end direct new government support for unabated international thermal coal power generation by the end of 2021.

In their discussion, Leaders recognised the central role of businesses, workers, civil society and local governments in the transition and noted commitments made through the Race to Zero campaign, and called for more partners to join ahead of COP26.

GOAL 2:

The climate is already changing and it will continue to change even as we reduce emissions, with devastating impacts. At COP26 we need to work together to enable and encourage countries affected by climate change to: protect and restore ecosystems; build defences, warning systems and resilient infrastructure and agriculture to avoid loss of homes, livelihoods and even lives.

In Carbis Bay, Leaders shared views on the impacts of climate change already being experienced worldwide and committed to supporting vulnerable people, communities and natural habitats to adapt to and cope with the impacts of climate change and biodiversity loss. The Presidency affirmed the Paris Agreements recognition that developing country partners are particularly vulnerable to the adverse effects of climate change. To support this effort, Leaders discussed the need to scale-up financial resources for adaptation action according to national plans (including National Adaptation Plans) and at local and sub-national levels. Further, Leaders recognised the important goal of “30by30” targets to conserve or protect at least 30 per cent of global land and 30 per cent of the global ocean by 2030, and supporting domestic targets according to national circumstances and approaches. CBD COP15 represents a once in a decade opportunity to determine a new Global Framework for Biodiversity, including new targets to 2030.

In support of adaptation to protect communities and natural habitats, the United Kingdom has submitted an Adaptation Communication and is a partner to the Risk-Informed Early Action Partnership (REAP) and the InsuResilience Global Partnership. To protect lives and tackle loss and damage caused by climate change, the United Kingdom, Germany and the United States have committed to a package of support. As part of this the United Kingdom and Germany have committed £120 million and E125 million of new financing respectively to deliver pre-arranged disaster risk finance for vulnerable communities through regional risk pools, contributing to REAP and InsuResilience Global Partnership protection targets. Under the Coalition for Disaster Resilient Infrastructure (CDRI) the United Kingdom and India have jointly committed to promote climate resilient infrastructure through a new facility for Small Island Developing States (SIDS). Australia is an executive member of the Coalition for Disaster →

→ Resilient Infrastructure (CDRI), has committed to submit an Adaptation Communication before COP26, and has joined the Adaptation Action Coalition and the Coalition for Climate Resilient Investment (CCRI). Canada has joined the InsuResilience Global Partnership, the CDRI, the Coalition for Climate Resilient Investment (CCRI), has joined the Adaptation Action Coalition, and has committed to join and submit an Adaptation Communication before COP26. The European Union has joined the InsuResilience Global Partnership, and has committed to submit an Adaptation Communication before COP26 on behalf of its Member States (including France, Germany, Italy). France has joined the InsuResilience Global Partnership, and the REAP. Germany has joined the InsuResilience Global Partnership and has joined the REAP. Italy has joined the CCRI. As well as its commitments related to SIDS, India has joined the Adaptation Action Coalition. Japan has joined the InsuResilience Global Partnership, REAP and the steering committee for the Adaptation Action Coalition and has committed to submitting an Adaptation Communication, doing so before COP26 if feasible. On biodiversity, India and South Africa have noted the importance of ocean protection and he need for nations to act together. The United States has joined the InsuResilience Global Partnership, has joined REAP, and has committed o join and submit an Adaptation Communication before COP26. The United States has joined the Adaptation Action Coalition, has announced its support for CDRI’s work, and has committed to new initiatives to transform energy systems and increase resilience for islands and remote communities, including strengthening SIDS’ climate resilience capacity. Canada and the United Kingdom have joined the Ocean Risk and Resilience Action Alliance (ORRAA) as full members. France, Germany, Italy, Japan, the United States, the European Union and India have joined ORRAA as observer members.

The United Kingdom has endorsed the Ocean Plastics Charter; the UK’s £500 million Blue Planet Fund will support countries including Ghana, Indonesia and Pacific island states to tackle unsustainable fishing, protect and restore coastal ecosystems like mangroves and coral reefs, and reduce marine pollution. Australia has joined the High Ambition Coalition for Nature and People, is increasing financing for nature-based solutions to climate change, has committed $100 million to increase support for blue carbon initiatives and marine protection, has joined the G7 in affirming their support for the global “30by30” targets, and has supported making the Osaka Blue Ocean Vision universal and the development of a global agreement on marine plastic pollution. Canada is committed to planting an additional two billion trees over the next 10 years, and has spearheaded the Ocean Plastics Charter since its 2018 G7 Presidency. The European Union has endorsed the Ocean Plastics Charter and supported starting negotiations on a new global plastics agreement at the next meeting of the UN Environment Assembly. France has endorsed the Ocean Plastics Charter. Germany has endorsed the Ocean Plastics Charter. Italy has endorsed the Ocean Plastics Charter. India has joined the G7 in affirming their support for collective global “30by30” targets, and committed to achieving domestic land degradation neutrality and restoring 26 million hectares of degraded land by 2030. Japan has engaged in making the Osaka Blue Ocean Vision universal, which includes the G20 Implementation Framework for Actions on Marine Plastic Litter. The Republic of Korea has also joined the G7 in affirming their support for collective global “30by30” targets by endorsing the High Ambition Coalition for Nature and People.

GOAL 3:

To deliver on our first two goals, all finance must be aligned with the goals of the Paris Agreement. Developed countries must make good on their promise to mobilise at least $100 billion in climate finance per year through to 2025 from public and private sources. Additionally, international financial institutions must play their part and we need work towards unleashing the

trillions in private and public sector finance required to secure global net zero.

In Carbis Bay, Leaders discussed the essential need to scale up public and private climate finance, including for developed countries to mobilise $100 billion per year in climate finance for developing countries as committed in Copenhagen and reaffirmed in Paris. Within this context, Leaders confirmed the importance of scaling up finance for adaptation and nature, and improving the effectiveness and accessibility of climate finance. Leaders discussed how a green and climate resilient recovery could be achieved, noting that a transformed global financial sector is necessary to support this in all countries - and will play a major role in meeting global financing needs. Leaders agreed that mobilising finance requires a global effort led by developed countries and including the public andprivate sectors, and called on

MDBs, IFIs and Developed Financial Institutions (DFIs) to increase finance for climate and nature, including private co-financing flows and ensure their policies and investments are Paris aligned by 2023 or sooner. Leaders called on MDBs, DFIs, and other public financial institutions to accelerate the development of solutions that mobilise private finance for mitigation, adaptation and resilience, and that support developing countries seeking to implement ambitious NDCs, climate resilience and climate-supportive economic policies. Leaders also supported the transformation underway to mobilise further private capital towards these objectives in particular to support developing countries and emerging markets in making the most of the opportunities in the transition; whilst mitigating and adapting to climate change.

In support of mobilising finance for developing countries and beyond the collective commitments detailed in the Carbis Bay G7 Summit Communique, Leaders have made the following specific commitments in order to increase and improve climate finance through to 2025: the United Kingdom will double its climate finance to £11.6 billion from 2021-2025 (compared to 2016-2020) to 2025, with roughly half for adaptation £3 billion of this for nature and all primarily grant based. Australia has reaffirmed its commitment to increase its climate finance by 50 per cent over five years, to AUD $1.5 billion, with a third going to Pacific Island countries. Canada has committed to a doubling of its climate finance to CAD $5.3 billion through to 2025, with an increased allocation toward grants of 40 per cent (this financing includes increased funding for adaptation, as well as biodiversity and nature-based solutions). The European Union has reaffirmed its intention to increase its climate finance to EUR 24 billion Euros over 2021-27 and to work towards the ambition of providing 7.5% of its annual spending to biodiversity objectives in the year 2024 and 10% in 2026 and 2027. France has reaffirmed its commitment to 6 billion Euros annually out to 2025 (up from 5 billion Euros in 2020) with a third on adaptation, and with 30 per cent on biodiversity co-benefits by 2030. Germany prospectively announced to increase its climate financing from E4 billion to 6 billion Euros per year by 2025 at the latest. Japan has committed to extend climate finance of JPY 6.5 trillion over the next 5 years, from 021 to 2025 and to improve its quality, including further enhancing assistance for adaptation . The United States has pledged to double its public climate finance by 2024 to $5.7 billion, tripling adaptation finance and is increasing commitments through the International Development Finance Corporation and Millennium Challenge Corporation. →

→ The Presidency looks forward to further commitments from others well ahead of COP26, including scheduled commitments from Italy ahead of UNGA. The Republic of Korea will scale up its green ODA by 2025, and provide a $5 million Green New Deal trust fund to accelerate the green transition and carbon neutral economic growth of developing countries. To support the efforts of developing countries that have decided to transition away from unabated coal-fired power, the United Kingdom, Canada, Germany and the United States plan to commit up to $2 billion in the coming year to the Climate Investment Funds Accelerating the Coal Transition and Integrating Renewable Energy programs, which is expected to directly mobilise up to $10 billion in private finance.

Beyond the collective commitments made by G7 Leaders, as detailed in the Carbis Bay G7 Summit Communique, the United Kingdom has committed to mandatory disclosure in line with the Task Force on Climate-related Financial Disclosures (TCFD) by 2025, with majority coverage by 2023. France is working with public and private partners to fast-track the greening of our economies through the framework of the One Planet Summits and has fully implemented the TCFD’s recommendations with the publication in May 2021 of a regulation on the extra-financial transparency of financial market players. Japan has taken steps towards mandatory TCFD based disclosures for top listed companies. The United States has committed to develop a comprehensive government -wide strategy to identify and disclose climate-related financial risk.

GOAL 3:

We can only rise to the challenges of the climate crisis by working together. At COP26, the Presidency is clear that we must accelerate action and partnerships to tackle the climate crisis throughcollaboration between governments, businesses and civil society. Within the multilateral process, as incoming COP26 Presidency the UK is committed to facilitating agreement on the outstanding elements of the Paris Rulebook (the detailed rules that make the Paris Agreement operational) as part of an ambitious set of negotiated outcomes that leave no issue and no Party behind.

At Carbis Bay, Leaders discussed

the importance of working together internationally to combat the dual challenges of climate change and biodiversity loss and of deepening collaboration to accelerate the development and deployment of green technology and nature-based solutions. Leaders discussed how best to collaborate on industrial decarbonisation, including through the new Industrial Decarbonisation Agenda, on aligning policy levers such as standard setting, investment support and procurement, working with wider initiatives and partners. Leaders also discussed how internationalcollaboration, including through the Energy Transition Council, could support the new economic opportunities and sustained quality job creation offered by a just transition to clean energy in developing countries.

In support of international collaboration, the United Kingdom has signed the Leaders’ Pledge for Nature. The UK has established and continues to co-chair, with Indonesia, the Forest, Agriculture and Commodity Trade (FACT) dialogue. Canada, the European Union, France, Germany, Italy, Japan, and the Republic of Korea have also signed the Leaders’ Pledge for Nature. The European Union, France, Germany, Italy, Japan, the Republic of Korea and the United States are participating in the Forest, Agriculture and Commodity Trade (FACT) dialogue. Alongside G7 members, Australia, the Republic of Korea and India are supporting Mission Innovation (MI) 2.0 and the Clean Energy Ministerial (CMI) 3.0 to accelerate the pace of low emissions technology development and deployment. The United States will host the 2022 CEM and MI meetings and is spearheading several global technology innovation initiatives. India will hold the CEM and MI meetings in 2023. India, with the United Kingdom, has committed to launching a global Green Grids Initiative at COP26 alongside providing constructive leadership through the COP26 Zero Emission Vehicle Transition Council and the Energy Transition Council. India, as co-lead for the initiative, and the Republic of Korea have joined the G7 members in endorsing the Superefficient Equipment and Appliances Deployment initiative and its goal to double the energy efficiency of key energy using products sold globally by 2030.

As we look from Carbis Bay to Glasgow in November, via the pre-COP in Milan in September and the G20 Summit in Rome in October, the UK and Italy are committed to working together and with all countries to increase global action on climate and nature, through our G7, G20 and COP26 Presidencies and beyond. Recognising that the avoided climate impacts are greater at 1.5°C than 2°C, the UK and Italy urge all countries to do their part and to take the steps that keep 1.5°C within reach. The UK and Italy affirm our strong and steadfast commitment to strengthening implementation of the Paris Agreement and to unleashing its full potential. At their discussions in Carbis Bay, and throughout this year, Leaders have made important commitments on global emissions, financing and adaptation to meet the goals of the Paris Agreement. But significant further action is needed, and through the five months ahead of COP26, the UK and Italy will continue to work with all countries, to encourage ambitious commitments towards the four COP26 Presidency goals.

The UK and Italy intend to use our respective Presidencies to build momentum as we approach UNFCCC COP26 and CBD COP15. We are committed to an inclusive, ambitious COP26 and a comprehensive negotiated outcome, and call on all countries, businesses, civil society, citizens and other stakeholders to join us in stepping-up efforts. We encourage businesses to set science-based targets, including through the Race to Zero and Race to Resilience campaigns. Together, these actions will be crucial as we collectively seek to make 2021 a turning point for our planet. ◆