New UNEP report lights the way for financial institutions to shift to more sustainable circular economies
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Geneva, 13 Oct (Canadian-Media): Financiers can and must make the shift to circularity, ensuring the consumption and production patterns of the businesses they invest in make more efficient use of resources and minimize waste, pollution and carbon emissions, according to a new report by the UN Environment Programme’s Finance Initiative (UNEP FI).
Image credit: Pixabay / 13 Oct 2020
It outlines a number of recommendations for financial institutions to boost circularity:
Swedish Insurance Fintech Omocon has developed a microinsurance product for the sharing economy, involving shareable goods rented out on a platform. The product protects the owner of a shareable good or asset that needs protection against damage. Omocom collects data on the sharing platform to look into the usage statistics of sharing transactions to calculate risk and price insurance. This has changed the underwriting process and claims processes.
The report also identifies the need for governments to provide the financial sector with incentives and an enabling policy and legislative framework to accelerate the integration of circularity into financial products and services. Recommendations for policymakers, financial industry regulators and supervisors to address barriers and stimulate opportunities include: integrating measures to catalyze a just transition to a circular economy into climate policies, rules and regulations, implementing COVID-19 recovery strategies that embed circularity in economic growth and focus on a resilient and inclusive recovery, and implementing policies, laws and related instruments to address systemic barriers to circularity and create incentives.