Greener finance

The Paris Agreement has sent clear signals to markets and to the financial sector that more than 190 countries are going to vigorously pursue the transition to a low-carbon economy that’s resilient to mounting climate change. It is no longer a question of if this transition will happen, but of how fast. Some of the key changes required lie outside the financial sector, such as changing relative prices of harmful goods and services vis-à-vis those that benefit the environment and the development of new technologies to facilitate changes in consumption patterns. Finance, however, has an important role to play.