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Sustainability 27 Dec 2019

Goodbye COP25! hello COP26. Now What?

At the forum entitled `Después de la Cumbre del Clima ¿Ahora qué?´ (The Climate Conference has ended, now what?, in English), Global Head of Responsible Business in BBVA, AntoniBallabriga, reflected on the steps that the banking sector must take following COP25. While acknowledging the “insufficient” results of the conference, he remarked that, “It marked another step toward reaching global agreements,” in which BBVA has actively participated. He highlighted the banking sector´s role in providing support and advice in the energy transition process.

The forum, organized by educational institution Next Educación, served to reflect following the days of intense debate at the Climate Change Conference in Madrid, where experts onsustainable development and climate change from both the public and private sectors participated, along with Director of the Office of the High Commissioner for 2030 Agenda, Federico Buyolo; Director of Climate Change at Iberdrola, Gonzalo Sáenz de Miera; and Director of Strategic Planning at the Spanish Banking Association (AEB), Juan CarlosDelrieu. Despite the difficulties in achieving global partnerships at COP25, experts acknowledged the role of the conference in creating awareness.

BBVA´s Global Head of Responsible Business, Antoni Ballabriga, was optimistic about the “involvement” and “close collaboration”; between the public, private and social sector in sharing practices and developing methods to bolster sustainability. Ballabriga also mentioned the agreement that was recently signed in New York by 34 banks willing to commit to aligning their business with the Paris Agreement as a sign of the banking sector´s involvement in aligning its portfolios with sustainable solutions.

Specifically, in response to the key topic of the debate —the Climate Conference has ended,now what?—, Antoni Ballabriga emphasized the supporting role that the banking sector must actively play on the path toward an energy transition that, he said, “Is going to happen no matter what,” noting that, “the later we act, the harder the disruption will be.” In his view, this role of providing support and advice involves, “Helping our clients, both SMEs and individuals, to make this transition and develop resilient business models funded by sustainable solutions.”

From left to right: Paloma Olabe (Clarity AI), Antoni Ballabriga (BBVA), Federico Buyolo (Agenda 2030), Manuel Campo Vidal (Next Educación), Ángela Baldellou (director máster ´Economía Verde´), Gonzalo Sáenz de Miera (Iberdrola) and Juan Carlos Delrieu (AEB).

BBVA´s Global Head of Responsible Business also took advantage of his participation in the forum to mention the financial institution´s new sustainability goal for 2020, which will see the inclusion of the cost of CO2 emissions in the planning process and budgets. This is a global measure that will specifically require each area to incorporate the cost of CO2 emissions into its budget and which encourages measures to accelerate the reduction of emissions. “Until we put a price on CO2 emissions, we will struggle to accelerate this energy transition,” he warned.

Sustainable development and the fight against climate change is a priority strategy for BBVA that represents “the greatest business opportunity for banking in the next ten years,” said Ballabriga.

The impact of regulation

The impact of the regulatory framework on the banking sector´s work toward energy neutrality was also discussed. Legislation must serve to force organizations to “report on minimum parameters that allow investors and banks to manage risks and provide better solutions to our customers,” said BBVA´s Head of Responsible Business.

However, the Director of Strategic Planning at the Spanish Banking Association (AEB), Juan Carlos Delrieu, recognized the limited capacity of the regulation, which he described as “still under construction”, to guide the banking sector in risk and opportunity management. However, he warned that, “as banks, we cannot fall behind — we must align ourselves with the Paris Agreement”.

Meanwhile, Director of Climate Change at Iberdrola, Gonzalo Sáenz de Miera, acknowledged that the electricity sector also needs an “environmental tax reform” that guarantees “a 100% renewable energy system.”

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