Shifting the trillions: the role of the G20 in making financial flows consistent with global long-term climate goals

This briefing paper describes how the G20 could enable a shift of international financial flows to low-carbon and climate-resilient development, as mandated by the Paris Agreement in Article 2.1c. It introduces the relevant long-term climate and Sustainable Development Goals, and outlines the current energy-, climate- and infrastructure-related work streams within the G20. It addresses the need to provide a reliable political framework for ambitious action and the important role of “long-term low greenhouse gas emission development strategies”. It then explores a broad range of issues related to the mobilization and characteristics of transition finance, such as disclosure of climate-related risks in the financial markets, stress testing and strategies towards GHG neutrality for businesses, the phase out of fossil fuel subsidies, policy instruments to correct the current market distortion and set energy prices right by pricing carbon dioxide emissions, and “Paris-compatible” investment criteria for public and private finance. Directed at decision makers and policy experts, it also highlights ways forwards for and favourable outcomes of the German G20 presidency.