Climate Change


Climate change is one of the most pressing challenges of our time, having significant impact on critical and vulnerable communities and ecosystems around the world. The Islamic Development Bank (IsDB) recognizes climate change action as a key priority area and invests in high impact projects in many sectors including energy (renewable and smart systems), climate-smart agriculture, forestry, resource efficiency, zero carbon buildings, sustainable transport, sustainable cities and urban development, coastal protection, waste management, water and sanitation, and others. Nevertheless, if climate-related risks are not adequately addressed in these projects, their development results could potentially be disrupted, and even reversed. 

The Bank addresses the challenges of climate change through adaptation-driven and resilience-focused investments and interventions. At the same time, it sees the opportunities climate change offers to the least developed, emerging and developed economies among IsDB’s member countries (MCs), through combined greenhouse gas emission mitigation and sustainable development, hence addressing the Sustainable Development Goals (SDGs) and Paris Climate Accord.

IsDB Climate Policy & Action Plan 

In 2019, the Bank’s Board of Executive Directors (BED) approved the IsDB Climate Change Policy. The Climate Policy builds on IsDB’s adoption of the Voluntary Principles for Mainstreaming Climate Action within Financial Institutions and the Multilateral Development Banks (MDBs) Common Principles for Climate Finance Tracking. In 2020, the Bank unveiled its Climate Change Action Plan (2020 – 2025). The 5-Year Climate Change Action Plan sets out how the IsDB mandate on climate change will be implemented with its clients and various stakeholders in line with the Paris Agreement and the MDB Paris Alignment Framework. It also sets out modalities for achieving IsDB’s climate finance target of 35% by 2025. 

The Bank is increasing its effort to ensuring that all its activities and operations contribute to the global Paris agreements goals by systematically integrating climate mitigation opportunities and adaptation measures in its investments and lending operations. This includes jointly working with other MDBs for a harmonized approach to Paris Alignment. To create sustainable systems, climate considerations have been mainstreamed in the Bank’s different sector policies and related operational strategies, including agriculture and rural development, energy, transport, health, urban development and water policies. 

Supporting IsDB Member Countries through Mainstreaming of Climate Action 

Moving towards green, low carbon and climate resilient development trajectories will require that IsDB Member Countries develop relevant strategies and investment plans at different levels including both at sectoral and national levels. Drawing from its own resources and others leveraged with its partners, the IsDB is engaging with its Member Countries at the planning and policy levels, working on building capacities at national level and supporting the preparation and implementation of national climate change plans and their Nationally Determined Contributions (NDCs). Engagements on climate action have also been incorporated under the framework of the IsDB Member Country Partnership Strategy (MCPS) 2.0.

In addition to climate finance, IsDB supports member countries meet their climate and sustainable development goals and targets through institutional strengthening, capacity building, partnership, and leveraging its resource-mobilization capabilities with other private, national, bilateral and multilateral development partners.

IsDB Climate Change Knowledge Hub

In 2020, the Bank developed and launched the IsDB Climate Change Knowledge Hub (CCKH) in partnership with the Stockholm Environment Institute (SEI). The CCKH is a dynamic, curated, online repository of national level climate action information for IsDB’s 57 Member Countries. The portal collects and connects dispersed sources of information from multiple partners in a map-based, interactive interface. It is suitable to Member Country practitioners as well as development partners to access information on NDC and SDG implementation, climate finance and relevant national policies, strategies and development plans. The platform also contains a repository of free, e-learning resources on climate related issues.