The International Court of Justice (ICJ) details its Advisory Opinion issued on July 23, 2025, concerning States' obligations regarding climate change. The United Nations General Assembly requested this opinion, posing two key questions: what are States' international legal obligations to protect the climate system from anthropogenic greenhouse gas emissions, and what are the legal consequences for States that cause significant harm through their acts or omissions? The ICJ's unanimous opinion, a rare occurrence, found that States have binding obligations under various international treaties and customary international law to address climate change and its impacts. Furthermore, the Court determined that a breach of these obligations constitutes an internationally wrongful act, entailing State responsibility, and clarified the framework for assessing legal consequences, including cessation of wrongful acts and reparations.

The BRICS initiative is aimed at reforming global climate finance. This initiative, detailed in a Technical Note prepared under Brazil's 2025 presidency, outlines a five-pillar framework to address challenges emerging economies face in accessing climate funding. The pillars propose reforming multilateral development banks, improving access to concessional finance, advancing country-led investment platforms, developing innovative private sector mobilisation strategies, and strengthening regulatory frameworks. The overarching goal is to mobilise at least USD 1.3 trillion annually by 2035 for developing nations, aligning with the Baku to Belém Roadmap and emphasising South-South cooperation in climate action.

The Australian Sustainable Finance Taxonomy is a framework established by the Australian Sustainable Finance Institute (ASFI), a collaborative body including financial institutions, government, and academia, to classify economic activities that contribute to environmental sustainability. The taxonomy aims to accelerate capital allocation towards Australia's net-zero ambitions by providing common standards for "green" and "transition" finance. It focuses on climate change mitigation within six priority sectors: Agriculture and Land; Minerals, Mining and Metals; Manufacturing and Industry; Electricity Generation and Supply; Construction and Buildings; and Transport. Additionally, it incorporates "Do No Significant Harm" (DNSH) criteria to prevent adverse environmental impacts and "Minimum Social Safeguards" (MSS) aligned with international human rights and responsible business conduct standards. The taxonomy, a key component of the Australian Government's Sustainable Finance Roadmap, is initially voluntary, with a review planned for mid-2025 to explore potential regulatory uses and expansion priorities like climate change adaptation.

The Green Impact Exchange (GIX), the first U.S. stock exchange focused on sustainability, was approved by the SEC. GIX aims to link environmental responsibility with capital markets by implementing strict governance standards, mandatory compliance, and incentives for eco-conscious companies. This exchange will operate with a dual-listing model initially, utilising technology for trading and enforcing accountability through audits and a "return to green" programme. By offering benefits like access to ESG capital and enhanced reputation, GIX seeks to combat greenwashing and drive a more sustainable financial ecosystem, though it faces challenges regarding liquidity and global harmonisation.

Thailand's pioneering national climate investment taxonomy, launched in July 2023, is the most comprehensive framework for climate-aligned investment classification in Southeast Asia. It introduces global innovations such as aquaculture guidance and a traffic light classification system for economic activities. The taxonomy's phased implementation, starting with energy and transportation sectors and expanding to cover nearly 95% of emission-relevant activities by Phase II, aims to steer capital towards Thailand's net-zero ambitions by 2065. Developed through collaboration with various organisations, this framework demonstrates strong alignment with international and regional standards like the EU and ASEAN taxonomies, positioning Thailand as a leader in sustainable finance and providing a model for other developing economies.

India's new regulatory framework for ESG debt securities, implemented by the Securities and Exchange Board of India (SEBI) in June 2025. The framework introduces clear guidelines for social, sustainability, and sustainability-linked bonds, aiming to standardise India's sustainable finance market and prevent misleading claims about the purpose of these investments. Key aspects include the mandatory alignment with international standards, strict anti-greenwashing measures, and comprehensive pre- and post-issuance disclosure requirements to ensure transparency and investor confidence. The framework is intended to support India's climate goals and attract both domestic and international capital for sustainable projects.

The Monetary Authority of Singapore (MAS) launched the Financing Asia’s Transition Partnership (FAST-P) in 2023 to mobilise up to US$5 billion in blended finance for decarbonisation and sustainable infrastructure across Asia. Anchored by Singapore’s US$500 million concessional funding pledge, matched dollar-for-dollar by partners, the initiative targets three strategic pillars: accelerating the energy transition (e.g., coal phaseouts, renewable grids), scaling green investments (renewables, electric mobility, waste management), and decarbonising heavy industries like cement and steel. FAST-P employs a risk-mitigating blended finance model, combining public, private, and philanthropic capital to unlock marginal projects, with the Green Investments Partnership – managed by Pentagreen Capital – set to deploy US$1 billion starting in late 2025. Key partners include the Asian Development Bank, Temasek, and BlackRock, while Australia has committed US$50 million, marking the first investment under its Southeast Asia Investment Financing Facility.

FAST-P addresses Asia’s urgent climate finance gap, where annual clean energy investments must surge from US$30 billion to over US$200 billion by 2030. The initiative prioritises Southeast Asia’s 4% yearly electricity demand growth and 85% fossil fuel reliance, focusing on projects like solar farms in Thailand and grid upgrades in the Philippines. A dedicated FAST-P office, announced in May 2025, will oversee fund deployment and partnerships, ensuring compliance with environmental and social governance standards. Despite global economic uncertainty and regulatory fragmentation, FAST-P aims to model scalable blended finance solutions, bridging the divide between climate ambition and actionable projects while reinforcing Singapore’s leadership in regional climate finance.

This episode discusses the methodology and implementation of the Network for Greening the Financial System's (NGFS) short-term climate scenarios. They describe a modelling framework combining three interconnected models (GEM-E3, EIRIN, and CLIMACRED) to assess the impact of climate change and policy on the economy and financial system, covering transition and physical risks. The sources outline several hypothetical future pathways, including a rapid, technology-driven "Highway to Paris" transition and a "Sudden Wake-Up Call" triggered by delayed action, which result in varying economic and financial outcomes such as shifts in investment, inflation, unemployment, and sector-specific production and risk. The analysis considers how climate policies like carbon pricing and physical events like extreme weather are modelled and how these factors transmit through the economy to affect credit risk, asset valuation, and monetary policy.

UK Stewardship Code 2026, a significant overhaul by the Financial Reporting Council that redefines responsible investment governance. This updated code introduces a bifurcated reporting structure, separating a less frequent Policy and Context Disclosure from an annual, outcome-focused Activities and Outcomes Report, aiming to balance transparency with reduced administrative burden. It emphasises flexibility in applying principles across diverse asset classes, including fixed income and private markets, and significantly strengthens requirements for service providers. The new framework also prioritises market-wide and systemic risk management, such as climate change, and acknowledges the increasing role of technological innovation in stewardship practices, all while streamlining the process to enhance the UK's global competitive standing in responsible investment.

J.P. Morgan Asset Management successfully raised $1.5 billion for its Forest & Climate Solutions Fund II, surpassing its initial goal and indicating strong investor confidence in sustainable forestry. This fund, managed by their acquired Campbell Global, aims to generate financial returns while also focusing on carbon sequestration and environmental benefits. The capital will be used to acquire and sustainably manage timberland, primarily in the U.S., adhering to environmental standards. This initiative highlights the increasing institutional interest in forestry as an asset class that offers diversification, inflation hedging, and positive climate impact, positioning J.P. Morgan as a key player in natural capital investment.

Slovenia pioneered the EU's first Sovereign Sustainability-Linked Bond (SLB) Framework in March 2025, a novel approach connecting its borrowing costs to achieving ambitious environmental targets aligned with both national and EU climate goals. This framework, validated as "advanced" by S&P Global, utilises three key performance indicators focused on GHG emissions reduction, increased renewable energy share, and improved energy efficiency, featuring a tiered coupon system that incentivises target attainment through financial rewards or penalties. While strategically significant and potentially replicable, the framework faces implementation challenges related to geographic constraints, socioeconomic disparities, and the complexities of data verification. Ultimately, Slovenia's initiative demonstrates a commitment to climate accountability within sovereign finance, offering a blueprint for other nations pursuing sustainable development

China marked a significant step in sustainable finance by issuing its inaugural sovereign green bonds in April 2025 on the London Stock Exchange. This dual-tranche offering, denominated in RMB and totalling 6 billion yuan, attracted strong international investor demand. The issuance signifies China's commitment to its climate goals, the advancement of RMB internationalisation, and the harmonisation of its green finance standards with global practices. Supported by a comprehensive Sovereign Green Bond Framework aligned with both domestic and international principles, the bonds will fund environmentally beneficial projects. This landmark transaction establishes a crucial benchmark for RMB-denominated green bonds and underscores China's growing role in the global green finance market.

Amidst a shifting political landscape in early 2025, major banks are privately anticipating catastrophic climate change exceeding Paris Agreement targets, even as many American institutions publicly retreat from climate alliances due to legal and political pressures. This divergence contrasts with European banks, which largely maintain their climate commitments and demonstrate greater readiness for climate adaptation. Central banks globally show varied approaches to climate risks, often influenced by national political agendas rather than solely by economic assessments. Consequently, the future of sustainable finance involves adapting to higher warming scenarios and reshaping climate finance initiatives, with COP30 serving as a crucial juncture for international commitment.