Dive Brief:

• The United Nations (U.N.) named former New York City Mayor Michael Bloomberg to lead a year-long initiative meant to drive at least $100 billion of private finance by 2020 to programs that will fight climate change and uphold the goals of the Paris Agreement.
• The Climate Finance Leadership Initiative will include participants from international financial firms and corporations, with a one-year term ending at the U.N. Climate Summit in September 2019. Members will be announced by the end of the year, according to a press statement.
• “The market’s allocation of capital is a powerful weapon in our fight against climate change. As climate risks and opportunities become more transparent, investors and businesses are increasing financing for climate solutions,” said Bloomberg, who last year was named special envoy for climate action by the U.N. Bloomberg also announced plans to start the Wall Street Group on Sustainable Finance, to focus on sustainable finance innovation in the U.S.

Dive Insight:

The announcement came the same day that leaders gathered to re-affirm their commitment to upholding the goals of the Paris Agreement at the One Planet Summit headed by French President Emmanuel Macron. Reuters reports that the role of businesses was a key talking point at the summit. “We have to shift one-third of the global financing to financing of climate change and new climate action,” Macron told attendees. “Everybody is waiting for us and everybody today wants us just to accelerate.”

Since President Trump said the U.S. would leave the Paris Agreement last year, cities and states have taken up the lead in pushing climate action to uphold the U.S. commitment. But corporate money will be key to getting ambitious projects off the ground, both at home and in developing countries where money is scarce. Renewable energy has become more financially attractive — even if some utilities question the financial impact of the 100% renewable targets set by some mayors — but other projects like adapting infrastructure for more extreme weather or building resilient grids abroad remain a tougher sell for private investors.

Bloomberg’s involvement should offer some heft to the effort — as a billionaire, Bloomberg has put his own money behind climate efforts and has clout in the business community. Still, some developing countries say they’d also like to see wealthy nations make a bigger investment; Amjad Abdulla, chief climate negotiator for the Maldives, told Climate Home that private finance "is simply too unpredictable to provide the kind of certainty of access every finance ministry from a vulnerable country knows is critical to meeting this challenge."