The project is jointly implemented NewClimate Institute, Germanwatch and Frankfurt School of Finance and Management – UNEP Collaborating Centre for Climate and Sustainable Energy Finance. This discussion paper was drafted by Paul Healy at Germanwatch and published on the website of the German Environment Agency (Umweltbundesamt, UBA).

Article 2.1(c) commits signatories to the Paris Agreement to “making finance flows consistent with a pathway towards low greenhouse gas emissions and climate resilient development”. Yet, how to operationalise and assess progress remains unclear and fragmented. 

This discussion paper is part of a research series that aims to develop a country level assessment framework for Article 2.1c. The paper undertakes a mapping of existing frameworks to assess Article 2.1(c). The aim of the mapping is to offer a comprehensive review of available frameworks tracking progress toward Article 2.1(c), identifying key trends, gaps and lessons for future development. The mapping is carried out in two steps: 

• Firstly, frameworks are classified along a set of parameters: the level of application, dimensions of alignment, reference pathways used, polarities of finance flows, nature of the assessment and stocks and flows covered. 
• Secondly, the paper offers explicatory guidance. Together, these two steps characterise frameworks by key parameters and compare similarities and differences across entity, country and international level frameworks.

Building on this mapping, the paper identifies key blind spots, including the limited coverage of adaptation finance, corporate investment and internal financing, and suggests ways to leverage design features from entity-level frameworks to strengthen country-level approaches. Thereby, the paper contributes to efforts like the Global Stocktake and related UNFCCC work processes, that have called for the development of effective, informed Article 2.1(c) country-level frameworks.

This discussion paper is part of a broader effort to develop a country-level framework to assess progress on aligning finance flows with Article 2.1(c) of the Paris Agreement. The framework will be applied in Germany as a first step, with further assessments to follow as part of an upcoming series.