Climate finance is booming, now reaching over $600 billion in 2020. Yet, as the newest IPCC report makes clear, unequal climate impacts are escalating, making a justice-oriented approach to climate finance more important than ever. The question is: how can funders most effectively and meaningfully implement an intersectional lens to their climate investments?

Climate justice recognizes that the communities least responsible for creating the climate crisis will be hardest hit by its consequences. Despite the global North contributing over 60% of global emissions, the 10 countries most threatened by climate change are in the Global South. This climate vulnerability is layered on top of pre-existing social and economic injustices and vulnerabilities. Within the United States, for example, Black communities are 40% more likely to live in areas exposed to extreme weather events, which in turn widen the racial wealth gap, driving a negative feedback loop.

Climate justice recognizes these overlapping vulnerabilities by putting people at the heart of climate strategies. This approach seeks to mitigate risks and distribute benefits equitably, ensuring they reach marginalized communities. Critically, climate justice integrates considerations of gender, race, income and wealth, and other categories of identity. Ultimately, a focus on both environmental and social impact can make the transition to a net-zero future a just one.

Climate justice can also amplify financial gains. A human-centered approach can future-proof investments by mitigating risk and enhancing resilience. It can also enable investors to tap into underexplored climate finance opportunities in underserved regions and communities.

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