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market mechanisms); common time frames for nationally determined contributions; long-
term climate finance etc. The other important issues for COP 26 include governance of Warsaw
International Mechanism for loss and damage, continued work on pre-2020 implementation
and launch of second periodic review of the long-term global goal under the Convention
and of overall progress towards achieving it. On finance matters, it is essential to arrive at a
consensus on the definition of climate finance and on a common accounting methodology for
assessment and evaluation of climate finance. This is also critical for initiating the process
required for establishing the new collective goals on climate finance, post 2020, based on the
requirements of the developing country parties.

ALIGNING FINANCE WITH SUSTAINABILITY

Augmenting Finance for Sustainable Development
6.27 There is a coherent move to augment financing for sustainable development. Consistent
with the aspirational vision for the financial sector in India, the Government’s development
priorities and the need to support the well-being of the people, several measures have already
been taken in the past few years and further steps are being taken. These include the following:

(i) National Voluntary Guidelines for Responsible Financing was finalized in 2015. These
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are financial sector-specific guidelines that combine and adapt international and national
best practices. The guidelines are a voluntary instrument and raise the bar of conduct for
financial institutions beyond compliance. These guidelines lay down 8 principles, which
cover different aspects of environmental, social and governance (ESG) responsibilities
to inform business action.
(ii) In 2015, the RBI included lending to social infrastructure and small renewable
energy projects within the priority sector targets . In September 2020, the loan limits
3
for renewable energy were doubled to ` 30 crores and for individual households, the
renewable energy loan limit is ` 10 lakhs per borrower. 4

(iii) The ‘Voluntary Guidelines on Corporate Social Responsibility’ were issued in 2009 to
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mainstream the concept of business responsibility. The guidelines were developed based
on India’s socio-cultural context and priorities as well as global best practices including
United Nations Guiding Principles on Business & Human Rights, Paris Agreement on
Climate change etc. The revised guidelines were released as the National Guidelines on
Responsible Business Conduct in March 2019. The NGRBC has been designed to assist
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businesses to embrace the principle of responsible conduct.

(iv) In order to reflect the NGRBC principles in the Business Responsibility Reporting
(BRR) framework, a Committee was constituted to review and update the BRR

2 https://www.cafral.org.in/sfControl/content/LearningTakeaWays/1213201764617PMNationalVoluntaryGuidelinesfor Responsible
Financing.pdf
3 https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=10497&Mode=0
4 https://www.rbi.org.in/scripts/NotificationUser.aspx?Mode=0&Id=11959
5 http://www.mca.gov.in/SearchableActs/Section135.htm
https://www.mca.gov.in/Ministry/pdf/NationalGuildeline_15032019.pdf
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