COP 30 – a turning point for climate, human rights and the finance sector? – United Nations Environment Programme Finance Initiative (UNEP FI)

Report on the Convergence of Human Rights, Climate Action, and Sustainable Finance

Introduction: The Legal Imperative for Advancing the Sustainable Development Goals

The July 2025 ruling by the International Court of Justice (ICJ) has established a new legal precedent with significant implications for global climate action and the achievement of the Sustainable Development Goals (SDGs). By formally recognizing a clean, healthy, and sustainable environment as a fundamental human right, the ruling directly reinforces SDG 13 (Climate Action) and SDG 16 (Peace, Justice and Strong Institutions). This development positions the upcoming COP30 conference as a critical forum for integrating human rights into climate strategies. This report analyzes the implications of the ICJ ruling for State obligations and outlines the associated risks and opportunities for financial institutions in advancing the global sustainability agenda.

State Obligations and the Link to the SDGs

The ICJ’s conclusions affirm the 2022 UN General Assembly resolution, compelling States party to international human rights treaties to address climate change as a core obligation. This legal framework creates a powerful driver for national policies aligned with the SDGs.

• SDG 13 (Climate Action): States are now under increased legal pressure to implement robust climate mitigation and adaptation measures to protect the human right to a healthy environment.
• SDG 3 (Good Health and Well-being): The ruling codifies the link between environmental quality and human health, mandating action on climate-related health risks.
• SDG 16 (Peace, Justice and Strong Institutions): The decision strengthens international law, providing a legal basis for holding States accountable for climate inaction and its impact on human rights.

The increased regulatory pressure on States is expected to cascade down to non-state actors, including corporations and financial institutions, creating new momentum for business practices that support the SDGs.

Opportunities and Risks for the Financial Sector

The evolving legal and regulatory landscape presents both material risks and significant opportunities for financial institutions (FIs). Proactive engagement can position FIs as leaders in sustainable finance, while inaction creates exposure to legal, reputational, and financial risks. FIs have a crucial role in financing the transition required to meet these new obligations.

1. Financing Sustainable Development: There are expanding opportunities to direct capital towards projects that support climate mitigation and adaptation, directly contributing to SDG 7 (Affordable and Clean Energy), SDG 11 (Sustainable Cities and Communities), and SDG 13 (Climate Action).
2. Adopting a Just Transition Framework: Integrating Just Transition principles is a powerful strategy for FIs to align with the SDGs. This approach ensures the shift to a green economy is equitable and inclusive, supporting:
   • SDG 8 (Decent Work and Economic Growth): By financing projects that create green jobs and support livelihoods.
   • SDG 10 (Reduced Inequalities): By ensuring vulnerable communities benefit from the transition.
3. Enhanced Due Diligence: FIs must strengthen due diligence processes to integrate human rights considerations alongside environmental risk assessments. Tools such as the UNEP FI Human Rights Toolkit can facilitate this integration, ensuring that financing activities do not adversely impact human rights and contribute positively to the SDGs.

Case Studies: Financial Innovation for the SDGs

Financial institutions are already developing innovative products and services that align climate action with human rights and the SDGs.

Banking Sector Initiatives

• Triodos Bank (UK): Provided financing for a community-owned solar farm, generating renewable energy for over 800 homes. This initiative directly supports SDG 7 (Affordable and Clean Energy) and SDG 11 (Sustainable Cities and Communities).
• BNP Paribas: The “My Sustainable Home” initiative assists customers in financing energy-efficient home improvements, contributing to the decarbonization of residential real estate in line with SDG 11 and SDG 13 (Climate Action).

Insurance Sector Initiatives

• Pioneer Life Insurance (Philippines): Launched dengue insurance to help families manage the financial shocks from climate-driven increases in mosquito-borne diseases, an innovative adaptation measure supporting SDG 3 (Good Health and Well-being).
• Hollard Zambia: Developed a bundled insurance solution for micro-business owners to strengthen their climate resilience, thereby protecting livelihoods and contributing to SDG 1 (No Poverty) and SDG 8 (Decent Work and Economic Growth).

Conclusion

The ICJ ruling marks a pivotal moment, legally binding climate action to the protection of human rights. For the financial sector, this reinforces the business case for aligning strategies with the Sustainable Development Goals. By embracing a Just Transition framework and developing innovative financial solutions, banks and insurers can mitigate risks, seize emerging opportunities, and play an indispensable role in fostering a sustainable and equitable future for all. COP30 provides a platform to accelerate this collective effort, placing human dignity and the SDGs at the center of global climate action.

Analysis of Sustainable Development Goals in the Article

1. Which SDGs are addressed or connected to the issues highlighted in the article?

1. SDG 13: Climate Action
   • The entire article is framed around climate action, referencing COP30, the need for mitigation and adaptation measures, and the role of the finance sector in addressing climate change. It explicitly states that States “must now address climate change as part of their human rights obligations.”
2. SDG 16: Peace, Justice and Strong Institutions
   • The article’s foundation is the International Court of Justice (ICJ) ruling that recognizes a “clean, healthy and sustainable environment as a foundational human right.” This directly relates to promoting the rule of law at international levels and ensuring justice through legal frameworks that hold States accountable for their obligations.
3. SDG 7: Affordable and Clean Energy
   • The article provides a specific example of Triodos Bank financing a solar farm to “bring a solar farm to full community ownership, generating enough renewable electricity to power 825 homes each year.” It also mentions BNP Paribas’s initiative to help customers make their homes “more energy efficient,” which relates to clean energy and energy efficiency goals.
4. SDG 8: Decent Work and Economic Growth
   • The concept of a “Just Transition” is highlighted, emphasizing that the shift to a greener economy “must, be done in such a way that individuals and communities also benefit, from creating new jobs, improving existing livelihoods.” This connects climate action directly to economic well-being and job creation.
5. SDG 3: Good Health and Well-being
   • The article links climate change to health impacts, citing the example of Pioneer Life Insurance in the Philippines recognizing that “climate change—through rising temperatures and increased flooding—was driving the spread of mosquito-borne diseases like dengue.” Their insurance product is a direct response to a climate-related health risk.
6. SDG 11: Sustainable Cities and Communities
   • The initiatives mentioned, such as community-owned solar farms powering homes and support for decarbonizing residential real estate, contribute to making human settlements more sustainable, resilient, and environmentally friendly.
7. SDG 17: Partnerships for the Goals
   • The article discusses the need for “stronger collaboration across teams within financial institutions” and highlights the role of multi-stakeholder partnerships, such as UNEP FI providing tools and guidance for the finance sector, to integrate human rights and climate action into their operations.

2. What specific targets under those SDGs can be identified based on the article’s content?

1. Under SDG 13 (Climate Action):
   • Target 13.1: Strengthen resilience and adaptive capacity to climate-related hazards. This is addressed by insurers developing products like the dengue insurance in the Philippines and the micro-business insurance in Zambia to help communities manage financial shocks from climate impacts.
   • Target 13.2: Integrate climate change measures into national policies, strategies and planning. The article discusses how the ICJ ruling pressures States to integrate climate action into their human rights obligations, which will in turn influence national policies and regulations affecting the finance sector.
2. Under SDG 16 (Peace, Justice and Strong Institutions):
   • Target 16.3: Promote the rule of law at the national and international levels and ensure equal access to justice for all. The ICJ ruling is a prime example of promoting the rule of law at the international level by legally linking environmental protection to human rights.
   • Target 16.b: Promote and enforce non-discriminatory laws and policies for sustainable development. The article discusses embedding human rights considerations into finance, which supports the enforcement of policies that protect all people, especially vulnerable communities, from the adverse effects of climate change.
3. Under SDG 7 (Affordable and Clean Energy):
   • Target 7.2: By 2030, increase substantially the share of renewable energy in the global energy mix. The example of financing a community-owned solar farm directly supports this target.
   • Target 7.3: By 2030, double the global rate of improvement in energy efficiency. The “My Sustainable Home” initiative, which assists customers in making their homes more energy-efficient, is a direct contribution to this target.
4. Under SDG 8 (Decent Work and Economic Growth):
   • Target 8.3: Promote development-oriented policies that support productive activities, decent job creation, entrepreneurship, creativity and innovation. The “Just Transition” principle discussed in the article, which focuses on “creating new jobs, improving existing livelihoods,” aligns perfectly with this target.
5. Under SDG 3 (Good Health and Well-being):
   • Target 3.d: Strengthen the capacity of all countries…for early warning, risk reduction and management of national and global health risks. The development of insurance products for climate-exacerbated diseases like dengue is an example of managing health risks linked to global environmental change.

3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?

1. Financial Flows for Climate Action:
   • The article provides a concrete financial figure: “Triodos Bank, United Kingdom provided GBP 3 million of new senior debt” for a solar farm. This serves as a direct indicator of financial resources being mobilized for climate mitigation projects (relevant to SDG 13 and SDG 7).
2. Renewable Energy Generation:
   • The output of the solar farm is quantified: “generating enough renewable electricity to power 825 homes each year.” This is a specific indicator of progress towards increasing the share of renewable energy (relevant to SDG 7).
3. Adoption of Sustainable Practices by Institutions:
   • An implied indicator is the number of financial institutions that “integrate human rights due diligence into standard practice” using tools like the UNEP FI Human Rights Toolkit. This measures the institutional shift towards sustainable and rights-based policies (relevant to SDG 13 and SDG 16).
4. Access to Climate Resilience Financial Products:
   • The article mentions insurance products for micro-business owners in Zambia and for dengue in the Philippines. The number of individuals, families, or businesses covered by such products would be a clear indicator of enhanced adaptive capacity and resilience (relevant to SDG 13 and SDG 3).
5. Implementation of Just Transition Principles:
   • While not quantified, the article points to the “Just Transition” concept of “creating new jobs” and “improving existing livelihoods.” Progress could be measured by the number of green jobs created or the economic benefits directed to communities through climate-related projects (relevant to SDG 8).

4. Table of SDGs, Targets, and Indicators

Source: unepfi.org