Climate Policy Initiative (CPI), a think tank, has proposed what it sees as a unique framework for sustainable finance integrity covering financial actors in the public and private sector.

The draft document suggests minimum benchmarks for meaningful sustainable finance commitments and leadership benchmarks to highlight best practices.

These are defined in three categories – targets and objectives, implementation, and metrics and transparency.

However, the framework also identifies areas where collaboration across the financial system is needed to drive further progress.

For example, it states a need for globally harmonised taxonomies and standards for sustainable finance, pointing to the work being done by the International Platform on Sustainable Finance.

The draft framework was refined and guided by an advisory council of individuals and organisations from each segment of the financial system, including commercial banks, development banks, NGOs, and government representatives across Asia, Africa, Europe and the Americas.

“We are seeing tremendous momentum for net zero target setting and sustainability measures in the lead-up to COP26, but what’s missing is integrity,” said Rachel Kyte, dean of The Fletcher School and co-chair of the council.

“The Framework for Sustainable Finance Integrity allows us to objectively assess commitments, providing meaningful guardrails for credible target setting, implementation, and transparency.”

Laurence Tubiana, CEO of the European Climate Foundation and council co-chair, said: “There has been significant progress on announcing targets that attempt to transition the financial system towards a net zero, sustainable future.

“But it’s not clear that the sum total adds up to the future we need. This draft framework is unique in that it helps us define and measure progress across the full suite of public and private financial actors.”

Daniel Klier, global head of sustainable finance at HSBC (but soon to move to Arabesque), was on the advisory council and highlighted how the framework could help by restoring trust between parties.

He said a lack of trust meant people often reverted to “very simplistic ways of talking about the transition to net zero while in reality we all know this is a super complex debate”.

“I think the group [CPI] put together and the framework brings a lot of that trust, because we had everyone – from government, civil society, the private sector – speaking one language and I think that is so important,” he added.

The stated goal of seeing the framework implemented is “a Paris-aligned, environmentally sustainable, socially just, and employment-rich new net zero equilibrium that creates jobs, promotes well-being, addresses climate change mitigation and adaptation, protects nature and biodiversity, and tackles environmental degradation at large”.

The CPI is welcoming feedback, with a revised version of the framework planned in the autumn.