Framework for Sustainable Finance Integrity

The Framework for Sustainable Finance Integrity provides a structured approach to evaluate and drive the sustainability commitments of financial actors. It establishes 'Minimum Benchmarks' that all institutions should adopt—such as aligning portfolios with the Paris Agreement and eliminating new coal finance—and 'Leadership Benchmarks' for those seeking to drive transformative change, including science-based five-year emissions targets and comprehensive TCFD alignment. The report emphasizes the need for a 'whole-of-government' approach, the integration of biodiversity and just transition into financial mandates, and the necessity of cross-sector collaboration to avoid siloed efforts that fail to meet global climate goals.

• The document identifies a gap where the proliferation of sustainability commitments may not result in a net zero trajectory because the pace of change is too slow, leading to the lock-in of high carbon assets and insufficient attention to biodiversity and just transition.
• Minimum benchmarks for all financial actors include committing to align policies and portfolios with the Paris Agreement and Sustainable Development Goals to target net zero emissions by 2050, mainstreaming sustainability risk management, eliminating finance for new coal projects, and disclosing Scope 1 and 2 portfolio emissions.
• Leadership in targets requires setting science-based emissions reduction targets at five-year intervals that are consistent with IPCC pathways limiting warming to 1.5°C, and ensuring any offsets used are for long-term carbon removal.
• For governments, leadership involves a 'whole-of-government' approach that embeds net zero commitments into fiscal and economic policies, including carbon pricing, phasing out fossil fuel subsidies, and earmarking stimulus spending for green and social objectives.
• Development Finance Institutions (DFIs) can demonstrate leadership by setting private capital mobilization targets, phasing out all fossil fuel financing by 2030, and implementing innovative products like sustainability-linked sovereign bonds to support nature and biodiversity.
• Asset owners and managers are encouraged to use active ownership and engagement to ensure investee companies adopt ambitious targets, with a goal of having at least 70% of portfolio emissions aligned with net zero or subject to stewardship by 2030.
• Commercial banks should move beyond coal phase-outs to include other fossil fuels, such as tar sands, and adopt sector-specific transition plans to achieve a 1.5°C trajectory.
• Leadership in transparency requires full alignment with all Task Force on Climate-related Financial Disclosures (TCFD) recommendations and the tracking of non-aligned finance and Scope 3 emissions for priority sectors.
• The report highlights critical collaboration needs to avoid systemic risk, including the harmonization of credible emissions pathways by sector, the development of a global taxonomy for sustainable finance, and the creation of metrics to measure the real-economy impact of financial actions.

APA

Climate Policy Initiative (2021). Framework for Sustainable Finance Integrity. https://www.climatepolicyinitiative.org/wp-content/uploads/2021/05/Framework-for-Sustainable-Finance-Integrity-Consultation-Draft-May-2021.pdf

Chicago

Climate Policy Initiative. Framework for Sustainable Finance Integrity. 2021. https://www.climatepolicyinitiative.org/wp-content/uploads/2021/05/Framework-for-Sustainable-Finance-Integrity-Consultation-Draft-May-2021.pdf.

Wikipedia

{{cite report |author=Climate Policy Initiative |title=Framework for Sustainable Finance Integrity |date=May 2021 |url=https://www.climatepolicyinitiative.org/wp-content/uploads/2021/05/Framework-for-Sustainable-Finance-Integrity-Consultation-Draft-May-2021.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{climatepolicyinitiative2021framework, author = {{Climate Policy Initiative}}, title = {{Framework for Sustainable Finance Integrity}}, institution = {Climate Policy Initiative}, year = {2021}, month = may, url = {https://www.climatepolicyinitiative.org/wp-content/uploads/2021/05/Framework-for-Sustainable-Finance-Integrity-Consultation-Draft-May-2021.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }