In a massive boost for climate action and sustainability, 130 banks collectively holding $47 trillion in assets have joined with the United Nations this week to launch a new initiative for combatting climate change.

According to the newly-signed Principles for Responsible Banking, which was launched one day ahead of the UN Climate Action Summit in New York, banks responsible for one-third of the global banking sector committed to strategically aligning their business with the goals of the Paris Agreement on Climate Change and the Sustainable Development Goals, and massively scaling up their contribution to the achievement of both.

By signing up to the Principles, banks said they believe that "only in an inclusive society founded on human dignity, equality and the sustainable use of natural resources" can their clients, customers and businesses thrive.

With global leaders coming together to share the actions they are taking to attain the Sustainable Development Goals and address climate change this week in New York, UN Secretary-General António Guterres said at the launch event, attended by the 130 Founding Signatories and over 45 of their CEOs, that "the UN Principles for Responsible Banking are a guide for the global banking industry to respond to, drive and benefit from a sustainable development economy. The Principles create the accountability that can realize responsibility, and the ambition that can drive action."

The Principles are supported by a strong implementation framework that defines clear accountabilities and requires each bank to set, publish and work towards ambitious targets. By creating a common framework that guides banks in growing their business and reducing risks through supporting the economic and social transformation required for a sustainable future, the Principles pave the way for the transformation to a sustainable banking industry.

"A banking industry that plans for the risks associated with climate change and other environmental challenges can not only drive the transition to low-carbon and climate-resilient economies, it can benefit from it," said Inger Andersen, Executive Director of the United Nations Environment Programme (UNEP). "When the financial system shifts its capital away from resource-hungry, brown investments to those that back nature as solution, everybody wins in the long-term."

While action on climate change is growing, it is still short of what is needed to meet the 1.5°C target of the Paris Agreement.

More ambition, backed by a step change in investment from the private sector, is needed to tackle these challenges and ensure that humanity lives in a way that ensures an equitable share of resources within planetary boundaries.

The banking and private sectors can benefit from the investment they put into backing this transition. It is estimated that addressing the SDGs could unlock $12 trillion in business savings and revenue annually and create 380 million more jobs by 2030.

"To transit to low-carbon and climate-resilient economies that support the goals of the Paris Agreement requires an additional investment of at least USD 60 trillion from now until 2050," said Christiana Figueres, Convener, Mission 2020, who is credited as the architect of the Paris Agreement in her role formerly as Executive Secretary of the UN Framework Convention on Climate Change. "As the banking sector provides over 90 per cent of the financing in developing countries and over two thirds worldwide, the Principles are a crucial step towards meeting the world's sustainable development financing requirements."

Reprinted from the United Nations Environmental Program

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