Debating transition finance at London Climate Action Week 2026

Published 21 July, 2026 Event commentary

On 24 June 2026, CETEx and the Beijing-based Institute of Finance and Sustainability (IFS) co-hosted ‘Transition finance: from framework-building to implementation’ at LSE as part of London Climate Action Week 2026. This hybrid event brought together more than 70 participants in person and online, representing commercial banks, businesses, international initiatives, non-governmental organisations and research institutions.

Opening remarks were delivered by the Rt Hon Chris Skidmore OBE, Chair of CETEx, and Ma Jun, President of IFS. The event also featured presentations from Cheng Lin, Director of the International Cooperation in Green Finance Research Center at IFS, on lessons from China’s green and transition finance experience, including approaches to reducing transaction costs and improving access to finance; and Alicia Kedzierski, Head of Department, Sustainable Finance Division at the Financial Conduct Authority, on findings from the FCA’s Transition Finance Pilot.

Rt Hon Chris Skidmore OBE, Vanessa Havard-Williams, Ma Jun, Cheng Lin.

A panel discussion moderated by Rob Patalano, Executive Director of CETEx, brought together Ma Jun and Chris Skidmore alongside Vanessa Havard-Williams, Working Group Chair of the Transition Finance Council; Tim Lord, Head of Climate and Energy at HSBC UK; and Amal Benaissa, Director of Sustainability Advocacy at Bank of Africa–BMCE Group.

From left to right: Rob Patalano, Ma Jun, Rt Hon Chris Skidmore OBE, Vanessa Havard-Williams, Tim Lord. Online: Amal Benaissa

Key insights

Transition finance is moving from framework-building to implementation. The priority is to turn credible sector and company transition pathways into investible propositions, supported by clear financing plans, appropriate capital structures and mechanisms for assessing and tracking progress. Transition plans can provide an important bridge between policy ambition, company action and finance, recognising that companies operate within wider sectoral ecosystems.
Bankability and commercial viability remain the central constraints. Many transition activities are technically feasible but lack predictable cash flows, attractive risk-adjusted returns, or suitable risk allocation. Hard-to-abate sectors are therefore often also hard to finance. Carbon pricing, regulation, public finance, technical assistance and targeted risk-sharing can help projects reach commercial viability, but financing models must ultimately be able to stand without permanent subsidy.
Finance must respond to companies’ actual needs. SMEs face particular barriers, including limited credit histories, weak financial capacity, and poor awareness of available support. Many cannot structure complex blended-finance transactions themselves. Practical assistance is therefore needed to strengthen commercial propositions, identify the appropriate type and sequencing of capital, and connect firms with relevant public and private finance providers.
Credibility, standardisation and lower transaction costs are essential for scale. Clear definitions, practical taxonomies, independent assessment, relevant data and accessible carbon-accounting tools can strengthen confidence and reduce the cost of originating and assessing transactions. Transition frameworks should also enable feedback and iteration, rather than treating transition plans as static documents.
Transition finance reflects national priorities and sectoral contexts. In many African markets, transition priorities extend beyond emissions reduction to energy access, resilience, industrial development, employment, food and water security. Applying frameworks developed for advanced economies without adaptation risks excluding the countries and companies most in need of investment. Local banks can act as transmission channels between public policy and the real economy, while development finance institutions can support first movers, absorb specific risks, and help develop investible markets.

From transition finance frameworks to real economy outcomes
The discussion showed that scaling up transition finance will require coordinated action across the financing ecosystem: governments need to provide clear and consistent policy signals, coordination across departments and enabling measures that support commercialisation; companies must translate transition ambitions into credible, commercially grounded plans; and financial institutions need to understand their clients’ business models, value chains, transition pathways and financing needs, rather than acting solely as product providers. Development finance institutions can absorb targeted risks and support market creation, while local banks will be essential for reaching SMEs and scaling up investment through domestic economies.