London, Washington Wednesday October, 27 2021 – The #BackBlue Ocean Finance Commitment is being launched today by the Ocean Risk and Resilience Action Alliance (ORRAA), just days ahead of the start of COP26, the crucial climate talks taking place in Glasgow, UK.
The United Nations-backed Commitment – which is the first of its kind to focus on the Ocean – is designed to incorporate the Ocean in finance and insurance decisions, especially with its importance in the fight against climate change.
The Ocean is the planet’s largest carbon sink and has absorbed over 90 per cent of the heat from carbon emissions with significant negative impacts on its biochemistry and biodiversity. Marine and coastal natural capital are also critical resilience buffers, reservoirs of biodiversity and provide food, social and economic security to billions.
Leading financial institutions including AXA, Willis Towers Watson and Palladium are the first to sign up with more expected to add their signatures over the coming weeks.
The #BackBlue Ocean Finance Commitment, blends the following elements to ensure that a blue lens is applied to decision-making by the sector:
- Setting robust Net Zero commitments by joining one of the UN Race to Zero Financial Initiatives and by adopting science-based targets to reach Net Zero no later than 2050 in line with their criteria. This includes aligning investments with the UN-convened Net Zero Asset Owner Alliance’s target setting protocol.
- Driving financial system policy change by adopting corporate ESG standards and disclosures that align with the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) and adopting taxonomies on sustainable economic activities that define common and clear criteria for classifying projects and investments as sustainable.
- Investing in nature-positive outcomes for the ocean, based on the UNEP FI Sustainable Blue Economy Finance Principles, that drive investment into coastal and marine nature that halts biodiversity loss and sustains and builds the benefits that these ecosystems provide, while preserving and improving livelihoods.
- Accelerating the transition towards a healthy and sustainable ocean through lending, investment, and insurance practices that mitigate ocean risk and build the resilience of climate vulnerable coastal communities; and by supporting work to raise an initial US$500m of investment into coastal nature by 2030, to create scalable and investable finance and insurance projects and products.
- Joining ORRAA so that together the challenges posed by ocean risk can be met by pioneering new and innovative finance products that focus on driving investment into ocean and coastal natural capital that reduce risk and build a sustainable, equitable, resilient ocean, and regenerate its biodiversity.
Karen Sack, Executive Director and Co-Chair of ORRAA, said: “It is encouraging to have the first wave of signatories to the #BackBlue Ocean Finance Commitment and today we are calling on other financial institutions to sign up. While it is focused on the private sector, this really is in everyone’s long term interest. The climate emergency is Code Red for the planet – responding to that requires us to #BackBlue.”
Ulrike Decoene, AXA’s Group Chief Communication, Brand and Sustainability Officer, said: “The scale and urgency of the challenges posed by ocean-derived risks call for a transformative and global response. Through the #BackBlue Ocean Finance Commitment, the private sector, including the insurance and wider finance industry, can collectively empower and mobilise action to build resilience providing long-term benefits for ocean-linked economies, local communities and biodiversity across the world. This is at the heart of AXA’s long term approach and we continue to look for ways that we can pioneer and contribute to collective action in this space.”
“Willis Towers Watson sees that climate risk and ocean risk together equal financial risk. We are excited to #BackBlue to drive action from financial institutions for a sustainable ocean and a sustainable blue economy,” said John Haley, CEO of Willis Towers Watson.
ORRAA brings together finance and insurance sectors, governments and environmental organisations from across the world. It is leading global efforts to pioneer new and innovative products designed to drive investment into ocean focused and Nature-based Solutions, fundamental to tackling the threat of climate change, protecting biodiversity and building resilience.
Nigel Topping, UNFCCC High Level Climate Champion for Climate Action at COP26 said: “The Ocean is unquestionably one of the planet’s greatest assets. Yet all the science shows that it is in crisis. Ocean heating, pollution, overfishing, rising levels of acidity, and biodiversity loss are eroding its sustainability at significant cost to communities, societies, and businesses in both the short and long term. A resilient and Net Zero world is not possible without a healthy, regenerating ocean. The #BackBlue Ocean Finance Commitment is key to driving positive change towards a more resilient future.”
Jessica Smith, Nature Lead at the UN Environment Programme Finance Initiative (UNEP FI), said: “A healthy ocean plays a vital role in regulating the global climate, and mitigating the impacts of the climate crisis. Ambitious action needs to be taken from all strands of society – including private finance – in order to deliver a sustainable blue economy that fully values natural capital. As host of the Sustainable Blue Economy Finance Principles, we welcome further calls to action including the #BackBlue Ocean Finance Commitment, recognising the need to take a holistic approach to tackle the three interlinked planetary crises of climate change, nature loss, and pollution.” In May the UK became the second G7 country after Canada to become a full member of the Alliance, while Deutsche Bank also joined its growing ranks which includes Swiss Re and WWF. All of the G7 are Observers of ORRAA, as are India, Mexico, Norway and Fiji.