Metrics relating to climate finance will work towards the global goal for adaptation and resilience.International financial institutions from across the world have come together to propose a framework for metrics that will promote a more climate-resilient development system.
A paper, jointly researched by seven multi-lateral development banks (MDBs) and members from the International Development Finance Club (IDFC), outlines principles for assessing the contribution of development finance to climate change resilience.
To match the challenges that a changing climate brings, adaptation on a number of levels needs to be considered. Correctly using measurements and metrics are key to assessing how and which financing activities best contribute to climate resilience.
A Framework and Principles for Climate Resilience Metrics in Financing Operations has been developed in response to the 2015 Paris Agreement, which called for climate resilient development to be considered within financial flows. The agreement also set out a global goal on adaptation to fundamentally reduce vulnerability to climate change.
Underpinning the framework are four principles. They call for:
a context-specific approach and a consideration of the varied circumstances each individual project may encompass.compatibility with long timescales in projects and the potential for unexpected delays
an explicit understanding of the inherent uncertainties of climate change due to unpredictable and variable future inevitabilities
the ability to determine and cope with the boundaries of climate resilient projects and the indirect impacts a project may have on wider elements
Structured on a results chain model, a process where the result of one activity impacts the following activity, the framework covers the quality of a project design, as well as the project results in the long term. It is a flexible system which accommodates a broad range of climate resilient activities and provides consistency across existing metric systems.
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