Last November, States that took part in COP27 in Sharm El-Sheikh agreed to pass a new funding arrangement for responding to loss and damage associated with the adverse effects of climate change. Loss and damage (L&D) refers to the monetary and non-monetary losses and damages that people have experienced and will experience due to sudden and slow-onset events. Economic, or tangible, L&D includes the loss of property and livelihood, changes in labor and agricultural productivity, cost of medical treatments associated with climatic events, and so forth. Non-economic, or intangible, L&D includes but is not limited to the mental health impacts, loss of ecosystems, and loss of culture (places, artifacts, language, etc.) from climate change.
People who are most affected by and vulnerable to further L&D have contributed the least to the climate crisis. Therefore, is it morally right that those who are most responsible for the climate crisis should finance the new funding arrangement for L&D. Taking up the need to address L&D in an ethical manner, the Human Impacts of Climate Change programme published this month a new briefing paper on “Fair Sources of Finance for a New Loss and Damage Funding Arrangement.” The options offered in the paper are meant to present policy makers with feasible and fair sources of finance for funding the new L&D arrangement without taking money away from needed action into climate change mitigation and adaptation. Grounded in principles like polluter pays, historic responsibility, and needs based, the options center redressing fossil fuel harm, exploring existing financial instruments, and supporting a more just and equitable world.