Climate Change Data

Frontclear

Climate Impact & Sustainability Data (2023)

Reporting Period: 2023

Environmental Metrics

ESG Focus Areas

  • Climate finance
  • Financial market development
  • Sustainable economic growth
  • Poverty alleviation
  • Climate resilience

Environmental Achievements

  • Facilitated access to local currency (LCY) financing for climate-resilient projects, reducing reliance on hard currency debt.

Social Achievements

  • Onboarded 36 local banks and 7 regional and global banks.
  • Conducted 55 technical assistance activities, increasing by 72% compared to 2022.
  • Provided training to 227 participants across 5 countries.

Governance Achievements

  • Improved profitability and diversification of revenue base.
  • Implemented IMAAP4 to improve impact measurement and reporting.

Climate Goals & Targets

Long-term Goals:
  • Transitioning Frontclear into an essential financial infrastructure provider connecting domestic and global markets.

Environmental Challenges

  • Difficult year for emerging and frontier markets with record defaults and private investor withdrawal.
  • Limited domestic savings and deposits base in EMDCs.
  • Thin markets challenged by counterparty credit risk.
  • High cost of hedging currency risk.
  • Capital controls in many EMDCs inhibiting LCY market development.
  • Shortcomings in legal and regulatory frameworks relative to title transfer and close-out netting.
Mitigation Strategies
  • Providing guarantees to mitigate counterparty credit risk.
  • Implementing Tradeclear to support domestic liquidity.
  • Accelerating technical assistance efforts to eliminate barriers to market development.
  • Revised risk appetite to include countries with a minimum rating of CCC+.
  • Developing onshore LCY markets and global offshore currency hedging markets.
  • Working with central banks and regulators to improve legal and regulatory frameworks.
  • Providing training and capacity building to market participants.

Supply Chain Management

Climate-Related Risks & Opportunities

Opportunities
  • Mobilizing local and international capital for climate-resilient projects

UN Sustainable Development Goals

  • SDG 8: Decent Work and Economic Growth
  • SDG 13: Climate Action

Frontclear's activities contribute to these goals by promoting sustainable economic growth, creating jobs, and facilitating access to climate finance.

Sustainable Products & Innovation

  • Tradeclear