Last Wednesday, while convening at a green finance summit organized by the French government, 450 public development banks released a joint statement, pledging to refocus their investments in alignment with the Paris Climate Accords (ReutersDeccan Herald). Collectively, these institutions invest approximately $2.3 trillion annually, representing 10% of all global investments from public and private sources (Reuters).

U.N. Secretary General António Guterres stated that he was “encouraged” by the move but believes stronger action must be taken (Reuters). As written, the agreement does not take a strong stance on divesting from fossil fuel projects. The banks have stated only that they plan to work toward adopting a stricter position on coal. However, a smaller group, comprising a few European development agencies, did release a separate pledge promising to phase out their fossil fuel investments (Reuters, Climate Change News).

Sources have reported that earlier versions of the agreement included stronger language regarding this issue. It is reported that the primary opposition to these lines came from various Asian development organizations (Climate Change News). Notably, the Asian Development Bank was not a signatory to the joint agreement. This choice stands in contrast to the recent commitments by China, Japan, and South Korea to achieve carbon neutrality at or soon after the turn of the century (Guardian). Other lending leaders, including the World Bank, also abstained from signing (Reuters).