Both climate change and the policies implemented to address it have wide-reaching social implications for health, employment, productivity and the distribution of wealth. An effective climate response must take these dimensions fully into account and provide an answer to the question: how can we achieve a transition that is acceptable to all?
Considered from this angle, the concept of Just Transition becomes essential. A Just Transition is one that seeks to mitigate the negative social impacts of our transition to a low-carbon and environmentally friendly world and, conversely, to maximise positive impacts, as for instance, green job creation.
Given the diversity of issues and variety of approaches these challenges have given rise to, bringing about a Just Transition calls for a clear and precise framework that recognises its multiple dimensions: regions, workers, consumers and societies. This framework should facilitate the emergence of methodologies that companies and investors can use. It must also foster the invention or reinvention of financial tools and instruments that can channel investments towards actors and businesses that contribute to making the Just Transition a reality.
This is precisely the challenge Finance for Tomorrow has taken up, following through on Climate Finance Day 2019, devoted to the Just Transition, and backed by an ecosystem that leads the field on green and sustainable finance. Supporting the emergence of financial tools, methodologies and indicators, encouraging engagement policies and the development of local initiatives, promoting financial innovation: such is the practical yet ambitious roadmap established by Finance for Tomorrow and its members to put the Just Transition at the heart of their activities and support the global transition in the years ahead.