There is much to be excited about at the moment. Numerous policy announcements and actions from companies are helping to put climate change firmly on the agenda, fuelling hopes of a meaningful climate agreement in Paris in December.
A climate-themed week of events in the French capital in May raised my spirits. Some of the biggest beasts in the political, investment and corporate jungle carved time out of their diaries to join the debate.
Among the highlights was French President François Hollande, who hailed the importance of green bonds, the Portfolio Decarbonisation Coalition (PDC), and the reform of the EU's emissions trading system. These are all themes we write regularly about – AP4 CEO Mats Andersson was recently named Environmental Finance's Personality of the Year for his work driving the PDC forward.
The numerous other highlights included Axa CEO Henri de Castries announcing a major divestment from coal, and the news that all listed French companies will be forced to report their climate risks.
The momentum has continued since. The G7 group of nations has thrown its weight behind the decarbonisation of the global economy by the end of the century. And Norway's oil fund – which on average owns more than 1% of all listed shares in the world – is to divest coal assets.
To add to these developments, recent weeks have seen a steady stream of green bond issues, the launch of the first exchange traded fund to track yieldcos, and Goldman Sachs launching a new vehicle for Japanese solar securitisations.
In short, there are signs that many investors, politicians and companies have – at last – woken up to the tremendous risks and opportunities associated with climate change. Perhaps, amid all this goodwill and hubris, the 2°C target may be within grasp, after all.
While these brave words are hugely welcome, a note of caution is in order. Scratch beneath the surface and there is much that is less cheery. The fact that so many nations have yet to register their individual emissions targets (INDCs) ahead of Paris was flagged by President Hollande as a cause for concern.
Further progress is needed on climate finance. It is encouraging that the Green Climate Fund is up and running, but we are still nowhere near the $100 billion target by 2020, and this could prove a stumbling block in Paris.
While carbon pricing is steadily increasing and now has a value of nearly $50 billion, we are still a long way from rectifying this gross market failure.
Overall, I echo the sentiment of President Hollande: I am optimistic of a meaningful agreement in Paris, even though reaching one would be a miracle.