Climate Resilience
Programme
As the effects of climate change become increasingly severe, the urgency to direct
financing from capital markets toward climate resilience grows more pressing. The United
Nations Environment Programme (UNEP) estimates physical adaptation and resiliencefinancing needs in developing countries of up to USD300bn per year by 2030, while global
adaptation and resilience financing needs are significantly higher. 1
Current finance flows for climate resilience are way below these estimated needs. In 2021, the Climate
Policy Initiative found that financial flows related to climate resilience were only USD46bn per year, out of
total reported climate finance flows of USD632bn per year. 2

Almost all adaptation finance comes from theinternational public sector, with less than USD1bn
from private finance sources. The sustainable bonds
market offers a substantial opportunity to bridge thegap between current finance flows and the estimatedrequirements for climate resilience.
Green bonds have channelled over USD3tn from
capital markets to sustainable activities. They haveemerged as a primary vehicle for financing climateaction. Despite the significant progress made bysustainable bonds, only a small portion of the capital
flows are currently directed towards climateresilience: only 19% of labelled green bonds werefound to have any resilience-related use of proceeds.3

USD46bn

USD632bn

Only USD46bn
allocated toclimate resilience.
Just USD1bn comesfrom private
finance sources.

The demand for thematic borrowing and investment has expanded and diversified in recent years,
encompassing areas such as social, sustainability, SDG, blue, and resilience, among others. Despite thisgrowth in demand for labelled issuances, the supply of project pipelines still falls short, leaving investor
demand unmet.
The lack of clarity on what constitutes a resilient investment is a major reason for the supply anddemand mismatch in climate resilience investments. This uncertainty makes it difficult for both investors
and issuers to identify credible and impactful projects for inclusion in thematic instruments, hindering
the flow of capital towards this critical area.

www.climatebonds.net

Advancing ClimateResilience
To overcome this challenge Climate Bonds Initiative(Climate Bonds) is developing a Climate Resilience
Taxonomy that will provide a classification system andscreening criteria for climate resilience investments. Thistaxonomy will promote a more consistent, transparent,
and systematic approach to defining and identifying
such investments.
The development of the Climate Resilience Taxonomy is
one of several key levers for mobilising finance forclimate resilience that Climate Bonds is pursuing as partof its Global Resilience Programme.

Goal
To mobilise global capital for investments that enhance the climate resilience of economic, social,and ecological systems.

Objectives
To catalyse USD1.5tn within the thematic bond market to be directed toward resilience investments
by 2025.
To influence the public sector in priority Climate Bonds geographies to put in place measures thatincentivise investments in and reduce the cost of capital for projects that enhance climate resilience.

The Resilience Programme has three expected outcomes:
Outcome 1:
Investment opportunities that build resilience are being identified using common, science-based
standards and definitions.
Outcome 2:
Credible resilience measures are being financed at scale through the sustainable debt market.
Outcome 3:
The scale and speed of growth of resilience investments are accelerated through a supportive policy andregulatory environment that is underpinned by common and credible definitions of resilience
investments.

www.climatebonds.net

Programme scope:
Central to the Climate Bonds strategy is to use clear science-based
green definitions backed by institutional investors as a tool tomobilise governments and the public sector to act. Climate Bonds
plans to execute its strategy through three outlined workstreams.

Workstream 1: Science-based rulesets
Create clear guidelines and criteria for sovereign, sub-national, and corporate to issue debt forprojects that increase physical, social, economic, and ecosystem dimensions of resilience. Thisinvolves developing a Climate Resilience Taxonomy and updating the Climate Bonds
Standards and Certification Scheme to certify bonds aimed at building resilience.
Workstream 2: Market & pipeline development
Promote market growth by offering training, support, and tools that enable demonstration
issuances (sovereign, sub-sovereign, and corporate) to kick-start markets and mobilise resiliencefinance. Climate Bonds will engage with investors to provide education, improve reporting, andtransparency, and establish a knowledge-sharing platform for issuers and early adopters in themarket.
Workstream 3: Enabling policy
Incorporate resilience definitions into national and regional taxonomies. Climate Bonds currently
advises over 20 countries like the EU, China, and India. Promote resilience policies, including credit
support, preferential lending, and fiscal measures. Provide practical policy recommendations topolicymakers and development finance institutions (DFIs), supported by partners and global investors.

About Climate Bonds
An international non-profit organisation working to mobilise global capital for climate action. We achieve
this through the development of the Climate Bonds Standard and Certification Scheme, through ourpolicy engagement efforts and market intelligence work. We empower our partner organisations and key
stakeholders with the tools and knowledge needed to navigate, influence and instigate credible change.
To learn more about the Climate Resilience Programme, please visit www.climatebonds.net orcontact Ujala Qadir at ujala.qadir@climatebonds.net
Endnotes:
1. United Nations Environment Programme (UNEP), 2021. Adaptation Gap Report.
Available online: https://www.unep.org/resources/adaptation-gap-report-2021 [Accessed June 2023].
2. Climate Policy Initiative, 2021. Global Landscape of Climate Finance 2021.
Available online: https://www.climatepolicyinitiative.org/publication/global-landscape-of-climate-finance-2021/ [Accessed June 2023]
3. Climate Bonds Initiative, 2021. Estimate.