A decade after Paris: trust misplaced, trust betrayed — and the struggle to reclaim it

Ten years ago in Paris, countries agreed to contain global warming through emissions mitigation and to strengthen resilience to climate change. The Paris Agreement Paris Agreement (UNFCCC, 2015) rested on pledge-and-review, not coercive allocation: each country would set “nationally determined contributions” reflecting “highest possible ambition” in light of national circumstances; an “enhanced transparency” framework would make action politically accountable; and peer pressure and cooperation would ratchet up ambition every five years.

A decade on, the picture is paradoxical. Emissions growth has slowed but not peaked, and pledges remain insufficient to meet the agreement’s temperature goals (1). Investment in mitigation and adaptation falls far short of what is needed (2) and financial and technical support to developing countries has repeatedly proved inadequate (3). Public support for stronger climate action is near-universal (4), yet climate policy momentum is weakening or reversing.

The past decade is a story of trust: how it was placed in transparency, how it was strained by under-delivery, and what it would take to restore it.

Trust misplaced

Paris broke an impasse between developed countries demanding a universal, binding deal and developing countries resisting externally imposed targets they viewed as unfair or feared would be unsupported. Transparency became the trust-building hinge of that compromise, but the bargain could only hold if countries adopted credible, durable, pledge-consistent measures and followed through.

In this context, Mark Carney, then Chair of the Financial Stability Board, proved influential. Speaking as a central banker, he reframed climate change as financial risk and diagnosed a “tragedy of the horizon” (5): a mismatch between climate timescales and the business and political horizons shaping decisions. His remedy hinged on transparency: clear, consistent, comparable climate-risk information would trigger earlier repricing and capital reallocation, easing constraints on binding policy. Breaking the tragedy of the horizon. That logic was rapidly institutionalised through expanding climate disclosure frameworks. Yet a decade on, the disconnect is stark. Instead of a positive feedback loop, transparency has too often fed a closed circuit of reporting, with little repricing and little policy action to show.

Trust betrayed

Carney never claimed disclosure alone would solve the problem. He was explicit that information could catalyse change only if the policy response was credible. But governments largely confined themselves to legislating disclosure, focusing first on financial actors rather than the real economy. Disclosure was advanced as part of a broader transition package that economic actors were asked to trust; but the constraining and enabling measures that would have made it consequential did not follow. 

This breach of trust broke the intended feedback loop between market repricing and policy tightening. Without prudential reform, binding real-economy constraints, and a credible pathway, disclosure may move markets at the margins but will not drive reallocation at Paris scale.

This quiet devolution to markets spared policymakers the politically inconvenient task of confronting the economic, fiscal, and social equilibria underpinning the fossil-based political economy. Phasing out subsidies and raising carbon prices would have disrupted energy-dependent economies, with far-reaching effects on rents, employment, and consumption. Mobilising large-scale public investment to transform infrastructure would have strained already constrained public budgets. Addressing demand and behaviour would have required questioning carbon-intensive lifestyles among groups with the greatest economic and political leverage.

But substituting transparency for action also created policy risk. In the absence of visible real-economy follow-through, disclosure was easily reframed as regulatory overreach; and because policy had not yet produced clear transition constituencies, power remained with the status quo. As investors began to integrate climate risk and disclosure pressure grew, fossil-linked incumbents mobilised campaign funding and lobbying, orchestrated public campaigns, and used litigation threats to delay and dilute disclosure rules, then leveraged those wins to widen rollback beyond disclosure.

Trust was breached on three fronts. Between Parties to the Paris Agreement, as transparency exposed gaps between ambition, commitments, and delivery. Between governments and economic actors that took on transition risk or incurred compliance costs in reliance on rules later delayed, diluted, or reversed. Between governments and citizens promised protection against foreseeable harm.

Trust suspended

Paradoxically, transparency is being contested just as finance has become better equipped to use it, making Carney’s repricing mechanism more operationally plausible than ever. Climate stress tests and scenario analysis have matured, enabling institutions and supervisors to assess resilience to shocks and explore how alternative transition pathways affect asset prices.

Crucially, probabilistic scenarios developed at EDHEC Climate Institute now allow risks to be priced rather than merely narrated (6). Yet their data foundations, from corporate disclosures to Earth observation, are becoming uncertain.

Preserving the information infrastructure is necessary, but not sufficient. If finance is to act as a transition catalyst, policy must be the reaction medium: prudential frameworks should reward climate risk integration and transition finance, and governments must deliver durable real-economy signals through regulation, taxation, and spending. That follow-through is also what can restore trust, both with economic actors who were wrongfooted, and between Parties to the Paris Agreement, for whom transparency sustains ambition ratcheting only if it is met with action.

The required policies will not be delivered without rebuilding citizens’ trust in public institutions. Faced with rising complexity and accelerating pace, modern governments have largely converged on a system combining specialised administration informed by expertise with the management of public opinion, aimed at stabilising consent or securing compliance in the name of necessity. 

Trust erodes when institutions are experienced as unreliable, unresponsive to lived constraints, insufficiently transparent, or unfair in how they distribute costs and benefits (7). That erosion has fuelled two-track contestation: at the ballot box, distrust-based mobilisation has empowered movements hostile to climate action (8); in the courts, affected parties have sought to compel states to meet their duty of protection against foreseeable harm (9). 

Trust will not be restored through enhanced transparency or better messaging: necessity appeals are exhausted and now read as a substitute for authorisation. The measures required to close the gap between commitments and science are conflictual and distributive: they reshape citizens’ lives as producers and consumers. Rebuilding trust will require institutional rejuvenation: widening the information base, surfacing trade-offs, and strengthening consultation and deliberation to authorise choices before enforcement (10). 

Without that civic authorisation, there will be no coherent and stable policy, and therefore no horizon for lasting action at the scale and pace implied by the Paris goals.

References

(1) Emissions Gap Report 2025 (UNEP, 2025) – https://wedocs.unep.org/handle/20.500.11822/48854

(2) Global Landscape of Climate Finance 2025 (Climate Policy Initiative, 2025) – https://www.climatepolicyinitiative.org/wp-content/uploads/2000/06/compressed_Global-Landscape-of-Climate-Finance-2025.pdf

(3) Adaptation Gap Report 2025 (UNEP, 2025) – https://wedocs.unep.org/handle/20.500.11822/48798

(4) Globally representative evidence on the actual and perceived support for climate action (Andre et al., Nature Climate Change, 2024) – https://doi.org/10.1038/s41558-024-01925-3

(5) Climate change and financial stability (Mark Carney, Bank of England, 2015) – https://www.bankofengland.co.uk/speech/2015/breaking-the-tragedy-of-the-horizon-climate-change-and-financial-stability

(6) How to Assign Probabilities to Climate Scenarios (Rebonato et al., EDHEC Business School, 2025) – https://climateinstitute.edhec.edu/publications/how-assign-probabilities-climate-scenarios (peer reviewed paper forthcoming)

How Does Climate Risk Affect Global Equity Valuations? A Novel Approach (Rebonato et al., 2024) – https://climateinstitute.edhec.edu/publications/how-does-climate-risk-affect-global-equity-valuations-novel-approach

Rebonato, R., Kainth, D. & Melin, L. The Impact of Physical Climate Risk on the Valuation of Global Equity Assets. Environ Resource Econ 88, 857–894 (2025). https://doi.org/10.1007/s10640-024-00953-z

(7) OECD Survey on Drivers of Trust in Public Institutions – 2024 Results (OECD, 2024) – https://doi.org/10.1787/9a20554b-en

(8) Right-wing populism and the climate change agenda: Exploring the linkages (Lockwood, Environmental Politics, 2018) – https://doi.org/10.1080/09644016.2018.1458411

(9) Advisory Opinion of 23 July 2025 – Obligations of States in respect of Climate Change (International Court of Justice, 2025) – ENG: https://www.icj-cij.org/sites/default/files/case-related/187/187-20250723-adv-01-00-en.pdf - FR: https://www.icj-cij.org/sites/default/files/case-related/187/187-20250723-adv-01-00-fr.pdf

(10) The public and its problems (Dewey, 1927) – https://www.gutenberg.org/ebooks/71000

Photo by Elena Mozhvilo via Unsplash