Asian Development Bank

Standalone climate strategy and integration of climate in overarching strategy

This page is part of the E3G Public Bank Climate Tracker Matrix, our tool to help you assess the Paris alignment of public banks, MDBs and DFIs.

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Paris alignmentReasoning
Some progressADB’s strategic framework is relatively advanced. The climate strategy is comprehensive and addresses mitigation and adaptation. The overarching strategy refers to the Joint MDB Paris Alignment process and elaborates on how ADB could implement this. The do-no-harm principle and a clear timeline for alignment are missing in both strategies.
Climate strategyOverarching strategy
The strategy addresses mitigation and resilience issues. The Paris Agreement is well referenced, but the alignment process and the do-no-harm principle are missing.ADB’s Strategy 2030 lists climate change as one of eight strategic priorities. It commits to mitigating climate change, building climate resilience and enhancing environmental sustainability. The Operational Plan for the climate change priority outlines how ADB intends to align with the Paris Agreement, although doesn’t commit to a date for full Paris alignment.

Explanation 

Overarching strategy

ADB has fully mainstreamed climate change into its overarching strategy, and there is evidence that climate is in turn being gradually mainstreamed into its operations.

ADB was the first MDB to implement climate finance commitments through to 2030 in its Strategy 2030, detailed in its Climate Change Operational Framework 2017–2030 (CCOF 2030). The Bank’s strategy also suggests that ADB is going to take a more proactive role on climate; this means the Bank focuses more on communicating the risks of climate change and the opportunities associated with a low carbon economy. Further resilience measures would lead to greater economic and social benefits.

The Strategy 2030 makes climate change one of the Bank’s eight operational priorities. The strategy commits the Bank to addressing climate change, building climate and disaster resilience and enhancing environmental sustainability. The Strategy states that the future operation of ADB is going to be designed to help meet the SDGs, the Paris Agreement and the Sendai Framework for Disaster Risk Reduction.

The ADB has also published its “Strategy 2030 Operational Plan for Priority 3: Tackling Climate Change, Building Climate and Disaster Resilience, and Enhancing Environmental Sustainability, 2019–2024”. This details further plans for how to deliver climate finance across the ADB and how this translates to different departments within the organisation. It explicitly outlines how ADB intends to align with the Paris Agreement, stating that:

“ADB will start monitoring and reporting on “Paris-aligned” and “non-aligned” finance flows. This will be based on assessing if projects are consistent with the different countries’ low-emissions development pathways, and if they are compatible with the overall climate change mitigation objectives of the Paris Agreement. With regards to adaptation, ADB will continue to actively manage climate change risks and identify opportunities to make ADB operations more adaptive and resilient against the impacts of climate change. Non-aligned projects can still be financed, but in those cases developing member countries should be engaged on putting in place long-term strategies and accelerate the transition to low-emissions and climate-resilient development pathways.”

The statement that non-aligned projects can still be financed could potentially undermine the overall commitment to align with the Paris Agreement – this will require further monitoring and evaluation. It should also be noted that there appears to be no date by which the ADB has committed to be fully Paris aligned in this strategy.

Climate strategy

The Climate Change Operational Framework 2030 is centred on five actions: supporting institutional development and policy frameworks conducive to ambitious climate action; facilitating access to public and private, domestic and international climate finance; promoting the use of climate technologies in operations; developing knowledge solutions and capacity development support; and strengthening partnerships and networks. The climate strategy emphasises the need for moving away from the traditional demand-led model, which is positive.

The framework provides a detailed implementation plan that addresses institutional challenges in the ADB and how to mainstream climate in the various departments and strategic units, as well as in employee skill development. This clearly stands out against other MDBs.

The Climate Change Operational Framework 2030 does not outline how far ADB intends to align with the Paris Agreement. The strategy also does not refer to the do-no-harm principle and looks explicitly at countries’ NDCs, rather than at ADB’s institutional role in the Paris Alignment process and delivering the overall goals of the Paris Agreement.


 

Last Update: November 2020

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