Thorunn Egilsdottir

Corporate Communication Manager

30th June 2021

United Nations climate and sustainable development goals: How to become a sustainable bank

Nathalie Roth is senior advisor for climate finance, environmental and international carbon markets, valuation of climate change impacts and sustainable development benefits. For the past two decades she has advised international companies, governments and organizations in their efforts to become more sustainable. We are pleased that she took the time to talk to us about the United Nations climate and sustainable development goals. Find out how banks can become sustainable and do not miss her five practical tips for your sustainable lifestyle.

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1. Since its creation in 1945, the United Nations has aimed to encourage international cooperation in order to find solutions to economic, social or humanitarian problems. Protecting the environment has become a priority but how does it contribute to the well-being of people?

The United Nations Member States adopted in 2015 a set of 17 sustainable development goals, commonly called the SDGs, to be achieved by 2030. It is a mixed set of social, environmental and economic development goals ranging from ending poverty, improving health and education, reducing gender inequalities, tackling climate change and protecting our forests and waters. These goals come with a number of targets to be achieved by 2030, directly benefitting the well-being of people. Countries then define their own key performance indicators to measure progress towards the SDGs.

2. In September 2019, world leaders met in New York to discuss progress. Is the world doing enough to tackle climate change?

The sustainable development goal 13 is about taking urgent action to combat climate change and its impacts. Under the UN, the Paris Agreement on climate change was adopted in 2015 with Member States establishing national targets to tackle climate change. These targets have to become more ambitious every five years. Currently however policies in place around the world are not strict enough to combat climate change, we are rather heading towards a 3°C increase in temperature than the 1.5-2°C increase as prescribed by the Paris Agreement. But on regional levels the right targets are being put into regulation to move towards meeting the goals of the Paris Agreement. The EU has adopted the goal to reduce the emissions of greenhouse gases by minus 55% from the 1990 level by 2030 and to become carbon neutral by 2050. Luxembourg, has adopted the same targets, with 2005 as a reference year, through its new climate law from December 2020.

3. Climate change poses an increasing risk to humanity. The United Nations has defined a financing framework for sustainable development. What are the objectives?

The UN integrated national financing frameworks are a guide for financing national sustainable development priorities and the SDGs defined at the country level. What needs to be financed is laid out in a country’s sustainable development strategy and action plan, like Luxembourg’s 3rd national sustainable development plan for 2030. One of the priorities of this plan is, for example to guarantee the availability of financing for climate actions, access to clean energy and other SDGs. Making finance flows consistent with the pathway towards low greenhouse gases emissions and resilient development is also a requirement of the Paris Agreement. This has led to the development of Luxembourg’s Sustainable Finance Roadmap and Sustainable Finance Strategy and on the EU level the EU sustainable finance action plan. The collaboration with the private sector is essential to mobilise sufficient financing for the implementation of climate action in the real economy.

4. In terms of natural disasters, what risks is Luxembourg facing and how can we avoid them?

According to climate projections, a decrease in precipitation in the summer months and an increase in winter precipitation are to be expected in the future, while at the same time an increased risk of flooding and extreme weather events. These have consequences for construction and housing, the energy sector as well as agriculture, ecosystems and biodiversity. A series of actions to reduce the impacts of climate change and extreme weather events are for example presented in Luxembourg’s National Climate Adaption Plan for the period 2018-2023. Every household and every company has its own specific vulnerability to natural disasters, hence the right adaptation measures are individual.

5. In your eyes, what makes a bank sustainable and how can Spuerkeess help keep temperatures increases below 2 degrees Celsius or even below 1.5 degrees?

The first step towards becoming a more sustainable bank is to define a clear sustainability strategy, an ambitious action plan and setting up the right internal governance structures to implement them. Like for any other company, Spuerkeess can raise awareness among its staff on how to identify and address climate risks and opportunities and how to define sustainable activities for the bank’s day to day business activities. In addition, banks can start to offer more attractive products and services that specifically finance sustainable activities while reducing over time the lending, financing and asset management of activities that clearly hurt the climate and the SDGs. Directly engaging with companies that are carbon intensive to help them finance the transition to low carbon business models is also important. Further, access to better sustainability data and transparency is key for sustainable finance to grow more rapidly.

6. How can ordinary citizens contribute? What are your personal tips for our daily lives?

The five everyday sustainability tips

1. Be aware that nearly every consumption decision impacts the climate and nature.

2. Consume more consciously, buy regional and seasonal products, reuse and recycle.

3. Reduce your carbon footprint across your activities, especially through low carbon housing and low carbon mobility choices, like public transport, car sharing and pooling, grab your bike.

4. Try to reduce the carbon footprint of your financial investment decisions as well.

5. Start asking your investment advisor about the SDG and climate impacts of your savings and investment portfolio as well as products that can deliver both impact and required financial returns.

About the blog:

There is an urgent need for rapid transition to Global Environmental Sustainability. Thanks to changemakers, progress is possible. "Why does it matter?" is a bi-monthly series that takes a quick look at the forefront of today's trends around sustainability. From May 2021 on, we aim to elucidate this important topic through the eyes of our experts.

Your contribution counts too! From June on, don't miss out our experts' practical tips for your daily life.

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