Scaling Up Climate Finance through the Financial Sector or the “30 by 30 zero” is an IFC-led program in partnership with the World Bank and the Renewables Academy (RENAC) focused on harnessing the financial sector in the Philippines and other targets countries, with the objective of considerably scaling up private sector financing for climate mitigation and adaptation through local FIs. By 2030, the program is expected to support the Philippines to align financial sector strategies and reforms with the implementation of the new NDC through the achievement of the following immediate objectives: 1. The central bank (BSP) issues supervisory guidelines on climate risk management, governance, stress testing/scenario analysis, and reporting/disclosure by 2023 and the banking sector implemented these in practice by 2027 2. The Green Force in consultation with relevant financial sector regulators and ministries launches a green taxonomy by 2024 3. The SEC issues guidelines for institutional investors to review and assess green investment opportunities by 2024 4. Climate thematic bonds introduced to the Philippines capital market with at least $250 million of issuances by 2024, and at least 2 domestic institutional investors implemented climate strategy/action plans by 2024. 5. 3 participating banks increase their climate share of their portfolios to additional 5% of their relevant loan portfolio, and complete their carbon footprint measurement, transition risk/physical risk assessment, and integrates climate risks in their overall risk management systems. 6. Building sector has clear strategy to increase the adoption of green building/net zero building standards to align with NDC targets. To reach the above objectives, the program will be delivered through 5 work components: 1. Regulatory and supervisory reforms aimed at integrating climate risks in financial institutions risk management systems and regulatory framework for green finance as well as capacity building for financial sector regulatory authorities. (WB to lead) 2. Development of climate thematic bonds, and capacity building for domestic pension funds. (IFC- FIG / CBD to lead) 3. Capacity building for target FIs (3) to increase their green lending and climate risk management capacity (IFC- FIG to lead) 4. Climate implementation plan for building sector (IFC- CBD to lead) 5. Program coordination and knowledge sharing through national and regional platforms (IFC-FIG to lead)

Development Results Pending

Performance Standard	Description and Potential Impact	Mitigation
PS 1. Assessment and Management of Environmental and Social Risks and Impacts	This is a medium risk project. Financial institutions in Philippines may face a number of environmental and social risks due to lack of robust Environmental and Social Management Systems (ESMS) and lack of incorporation of E&S risks including climate and gender/GBVH risks limited capacity internally to uptake of climate risk assessments including limited procedures/approaches to screening high risks projects for E&S & climate risks including sub-project GHG emissions and climate-related disclosures. This may result in lack of adherence to the IFC Performance Standards particularly PS1. Other PS may be triggered as new clients are identified.	The project will ensure that all guidance and advice along with training is consistent with the IFC Performance Standards. FIG AS will coordinate with ESG team when ESG/climate risks needed to mitigated. This includes advising clients to develop or improve their ESMS/ESG internal policies and procedures consistent with PS1 requirements, to facilitate ESG related climate assessment and management of ESG / climate impacts and risks and climate disclosures, etc. Good practices on ESG/Climate should be incorporated into the training and awareness raising activities. This will draw on the key risks identified by CAO for the financial sector and in particular lessons learned from RCBC. Team to outreach to ESG AS Lead as new clients are identified for incorporation of joint proposals, assignment of LESS/ESG AS team members.