Aligning financial flows under the Paris Agreement

The document finds that Sweden's five largest banks have limited alignment with the Paris Agreement, having facilitated approximately USD 150 billion to high-emitting 'brown' sectors since 2016. While 'green' investments have increased, they remain significantly lower than 'brown' and 'grey' flows. The authors argue that a lack of granular data and standardized definitions hinders transparency, recommending the adoption of International Sustainability Standards Board (ISSB) standards and EU-level regulations to better track the transition to a low-emission economy.

• The five largest banks in Sweden—Svenska Handelsbanken, Skandinaviska Enskilda Banken (SEB), Swedbank, Danske Bank, and Nordea—demonstrate limited alignment with the Paris Agreement, showing a gradual increase in financing for high-emitting sectors like oil and gas exploration and production between 2010 and 2020.
• Since the Paris Agreement took effect in 2016, the sampled banks provided approximately USD 150 billion to high-emitting sectors, primarily through syndicated loans (USD 104.4 billion) and bond issuance underwritings (USD 36.3 billion).
• Financial flows are categorized into 'brown' (high-emitting), 'green' (low-emitting), and 'grey' (remainder). Brown flows account for roughly 20% and green flows about 10% of the total, while grey sectors—including banks, real estate, and corporate finance services—make up 67% or over two-thirds of the flows.
• Green investments in loans and bonds have increased in magnitude, but their overall proceeds remain significantly lower than those of brown and grey sectoral flows. 'Transition' financing, intended to replace fossil-based technology, represents less than 0.5% of the total and has little impact on the overall distribution.
• Analysis is constrained by a lack of granular data regarding the final destinations of capital and the absence of clear, standardized sector categorizations. The authors suggest that Swedish banks would benefit from International Sustainability Standards Board (ISSB) standards and EU-level regulations like the EU taxonomy.

APA

Sajtos, L., Marbuah, G., & Maltais, A. (2022). Aligning financial flows under the Paris Agreement. Stockholm Environment Institute. https://www.sei.org/wp-content/uploads/2022/10/sei-brief-sweden-banks-paris-marbuah-241022.pdf

Chicago

Sajtos, Laszlo, George Marbuah, and Aaron Maltais. Aligning financial flows under the Paris Agreement. Stockholm Environment Institute, 2022. https://www.sei.org/wp-content/uploads/2022/10/sei-brief-sweden-banks-paris-marbuah-241022.pdf.

Wikipedia

{{cite report |last1=Sajtos |first1=Laszlo |last2=Marbuah |first2=George |last3=Maltais |first3=Aaron |title=Aligning financial flows under the Paris Agreement |publisher=Stockholm Environment Institute |date=October 2022 |url=https://www.sei.org/wp-content/uploads/2022/10/sei-brief-sweden-banks-paris-marbuah-241022.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{sajtos2022aligning, author = {Sajtos, Laszlo and Marbuah, George and Maltais, Aaron}, title = {{Aligning financial flows under the Paris Agreement}}, institution = {Stockholm Environment Institute}, year = {2022}, month = oct, url = {https://www.sei.org/wp-content/uploads/2022/10/sei-brief-sweden-banks-paris-marbuah-241022.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }