This paper highlights existing barriers and challenges preventing the full integration of climate change risks and opportunities within the financial system writ large, including for its institutions. A “climate-informed” approach to both governing the financial system and investing is a necessary condition for achieving all adaptation financing goals, including those around mobilization. Underpinning
this will be a clear and comprehensive approach to climate risk management—the consequence of which will allow for greater potential for capturing opportunities to build a more resilient future society today, one that is more resilient to a warming planet.
This paper unpacks the barriers to financing adaptation and resilience and explores options and opportunities to address them. As one of more than two dozen background papers which will lead to “Action Tracks” of the GCA, this paper will focus on the challenges within the financial system writ large vis-à-vis financing adaptation and resilience investments, recognizing that the financial system is
comprised of both: 1. Diverse financial actors that supply financing across economies, and 2. The financial system governance bodies that guide, regulate, and otherwise ensure that the financial “system” itself is sound.