Natural Capital Finance Alliance
In June 2012, UniCredit was among the first 37 financial institutions to endorse the Natural Capital Declaration (NCD), which was officially launched at the United Nations Conference on Sustainable Development, also known as Rio+20.
Convened by the UN Environment Programme Finance Initiative and Global Canopy, the Natural Capital Finance Alliance (NCFA) is a collaboration with the finance sector to lead the integration of natural capital considerations into financial decision-making.
By way of example, UniCredit has already developed special credit policies that are designed to minimize the environmental impacts associated with providing financing for nuclear power plants, mines, water infrastructure, and coal-fired power.
The NCD takes the form of a commitment made by chief executive officers from the financial sector. Since its launch, the NCD has been signed by the CEOs of more than 40 financial institutions, demonstrating their commitment to the integration of natural capital considerations into financial sector reporting, accounting, and decision-making by 2020.
The NCD emerged from the belief that financial institutions would benefit from guidance on how to consider environmental factors in the context of risk management, due diligence, loan, investment and insurance activities.
The Natural Capital Declaration (NCD) has four main commitments:
- To build an understanding of the impacts and dependencies of natural capital on operations, risk profiles, customer portfolios, supply chains, and business opportunities
- To support the development of methodologies that can integrate natural capital considerations into the decision-making process of all financial products and services
- To work towards building a global consensus for the integration of natural capital into private-sector accounting and decision-making
- To collaborate, when appropriate, with the International Integrated Reporting Council (IIRC) and other stakeholders to build a global consensus around the reporting of natural capital considerations.
Advancing Environmental Risk Management, is the NCFA's flagship project, aiming to provide practical methodologies and frameworks to incorporate natural capital assessment into existing finance sector risk management frameworks.