Unveiling efficient organizational models for CSR and sustainability: UNEP FI’s insights
David Carlin, Head of Climate Risk and TCFD at UNEP FI, engages with key insights on the organizational models employed by UNEP FI to tackle sustainability, ESG, and climate-related challenges.
In this exclusive interview, David Carlin, Head of Climate Risk and TCFD at UNEP FI, engages with key insights on the organizational models employed by UNEP FI to tackle sustainability, ESG, and climate-related challenges. Through a discussion that delves into UNEP FI's initiatives, collaborations with financial institutions, and the broader landscape of sustainability metrics, David offers a unique perspective on how organizations can drive progress towards a more sustainable future.
How would you best describe your organization's structure within UNEP FI for addressing sustainability, ESG, and climate-related matters? How many people are dedicated to sustainability, ESG, and climate matters in your organization?
UNEP FI is focused on supporting a sustainable financial system. As such, we lead programs for financial actors around the world to help them progress on climate, nature, and other environmental objectives. We convene the net-zero alliances for banks, asset-owners, and insurers, and have launched industry-leading frameworks such as the Principles for Responsible Banking, Principles for Sustainable Insurance, and Principles for Responsible Investing (now our sister organization). My team leads on risk-related work that intersects with climate and other environmental issues. That includes climate-related disclosures such as the TCFD, nature-related disclosures such as the TNFD, and the development of guidance and tools around topics such as climate stress tests, risk and opportunity assessments, and transition planning. Our team of 10 is made up of project managers who oversee the different topic workstreams on environmental risk topics such as those mentioned above.
Could you please explain how you structure and coordinate your cooperation with the participating (pilot) banks that work with UNEP FI and help shape the various guidance documents you produce?
Our vision with our pilot programs with financial institutions is to leverage the convening power of the UN and the insights of experts to generate practice guidance, good practices, and case studies for participating institutions. For example, with our TCFD work, we started with the idea of exploring different physical and transition risks and then moved into collaborations that created assessment tools for those risks. We recognize the value of peer exchange and the usefulness of examples for the institutions we work with and make these core features of our work.
Are there any lessons learned for financial institutions that you could share from UNEP FI’s journey of formalizing and establishing your sustainability organizational structure and discussions with your partners?
From 5 years of working with over 100 institutions, we’ve seen a number of elements of success when it comes to establishing a strong sustainability organization within an institution. These include having senior leadership buy-in, as the advocacy of executive sponsors is critical if you are looking to integrate sustainability within an institution. In addition, different teams across the institution must develop the sustainability skills and knowledge they need to play their roles effectively. Furthermore, strong partnerships with industry peers and other experts are particularly important to create a race-to-the-top regarding good practices.
In your experience, when talking to banks around the world, how do they typically measure sustainability performance in their organizations? What kinds of indicators do they typically have? Which departments are responsible for measuring the mentioned indicators?
There are a number of increasingly accepted sustainability metrics that firms are using. On the climate side, the creation of net-zero commitments, measuring financed emissions, and setting interim emissions reduction targets are all central. Other sustainability goals relate to support for green finance, restoration of damaged ecosystems, and greening of internal operations.
Does UNEP FI use any specific market solutions to help address the above activities and assist financial institutions in addressing their ESG and climate challenges? If so, could you provide a few examples of how these solutions are used?
We have worked with commercial, non-profit, and academic partners who bring unique expertise to the fast-evolving issues of climate and sustainability. These collaborations have included the creation of white papers, the development of assessment tools, and the construction of frameworks.
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