As COP30 begins in Belém, transition plans are continuing to gain momentum as a critical tool for mobilising climate finance. This builds on the Co-chairs’ report of the G20 Sustainable Finance Working Group (SFWG), released in October, which set out robust recommendations for integrating adaptation into transition plans.
Private sector momentum accelerates
Last week’s COP30 Business and Finance Forum in São Paulo marked a significant milestone with the launch of the latest Global State of Investor Climate Action. The report, which analyses 220 institutional investors globally, reveals that 56% now disclose climate transition plans or elements of transition plans. This is not merely a reporting exercise – investors are actively using the plans of their investee companies to inform risk management, identify opportunities, and allocate capital with confidence.
The momentum behind transition planning can play a key role in driving private sector action on adaptation. When companies develop credible transition plans, they examine their exposure and vulnerability to physical climate risks across their operations. This drives better risk management and encourages companies to identify adaptation-related business opportunities, from developing drought-resistant crops to building climate-resilient infrastructure.
A roadmap for finance mobilisation
Last week also saw the release of the landmark Baku to Belém Roadmap. Produced by the Azerbaijani COP29 and Brazilian COP30 Presidencies, the Roadmap sets out a pathway to achieve the climate finance goal agreed at COP29 to channel $1.3 trillion per year into developing countries by 2035. It recognises transition plans as critical underpinning for sound financial investment allocation and risk assessments.
This message was echoed in the International Transition Plan Network’s new report, Private Sector Transition Plans: A Critical Tool for Mobilising Finance, which introduced five mechanisms through which transition plans support finance flows: enhancing market confidence and reducing greenwashing; enabling comprehensive risk management; supporting identification of investment opportunities; driving value creation and competitive advantage; and influencing access to capital and financing costs.
Adaptation moves to centre stage
The 2025 G20 South Africa Presidency and SFWG Co-chairs’ Sustainable Finance Report highlighted the role of adaptation and resilience in transition plans. The report recommends voluntary high-level principles for integrating adaptation and resilience considerations into transition plans and climate disclosures by both financial institutions and corporates. It also proposes a high-level approach for entities seeking to set adaptation targets and metrics.
The report recognised that transition plans “may support vulnerable communities and sectors in moving towards sustainable and climate-resilient economies, especially in EMDEs.”
Government support is essential
Governments play a vital enabling role. They can support adaptation-inclusive private sector transition planning by developing supporting tools, such as physical climate risk assessments that help companies understand their exposure to physical risk – Chile’s Atlas de Riesgos Climáticos provides an excellent example. Sector-specific adaptation plans, integrated into broader Sector Transition Plans, help the private sector identify available policy support and priority adaptation projects to finance or co-finance.
Insurance has a unique role to play
The insurance industry has a particularly important role as a risk carrier for the broader economy. Building on momentum from discussions at the Business and Finance Forum, the Global Sustainable Insurance Summit at COP30’s House of Insurance will demonstrate how insurers are integrating sustainability across underwriting and investment portfolios.
Credible transition plans can transform insurance markets, as explained by the UN Forum for Insurance Transition which put out guidance on this issue in July. When companies detail their planned actions to respond to physical risks and increase resilience, insurers can price risks more accurately, expand coverage to companies effectively managing exposures, and incorporate adaptation and resilience investments into premium pricing. This can create a virtuous cycle: better transition planning and implementation leads to better insurance terms, which incentivises further resilience investment.
The path forward
Transition plans have moved from emerging practice to become an integral element of climate finance architecture, including for financing adaptation and resilience.
As countries gather in Belém, the call to action is clear: integrate adaptation and resilience into transition finance frameworks and policies across the economy. The tools exist, the private sector is mobilising, and the international architecture is aligning towards a net zero and climate-resilient future – particularly for the most vulnerable communities and economies that need it most.
