UK looks towards a greener future
5 July 2019 at 4:57 pm
The UK government has launched a comprehensive Green Finance Strategy to help the nation reach net zero greenhouse gas emissions by 2050.
City Minister John Glen unveiled the strategy at the Green Finance Summit on Tuesday, and said the financial services sector would have a bigger role to play than any other industry in tackling climate change.
The Green Finance Strategy aims to increase investment in sustainable projects and infrastructure, while also strengthening the competitiveness of the financial sector.
Glen said the plan represented a new and exciting step in the UK’s long history of international leadership on climate change.
“Our strategy seeks to bring about a complete change in the way the City [of London] thinks and acts. We must ensure the financial risk and opportunities from climate change are integrated into mainstream decision-making,” Glen said.
“Because let’s be clear: the climate challenge poses an existential risk to the future of the planet and, by extension, our economy too.
“If our financial system is to remain resilient – and relevant – then the city must adapt.”
The UK’s 2050 net zero emissions target makes it the first major economy in the world to set such a pledge into law.
To help achieve this, the strategy said the green financial products market must be robust in nature.
The strategy promotes accelerating finance that supports the delivery of the UK’s carbon targets, clean growth, and environmental ambitions.
It also said the government must ensure UK financial services utilise the commercial opportunities from green finance, such as climate related data and analytics, and from the growth in green financial products and services.
An example of this is the Transition Pathway Initiative, which assesses companies’ preparedness for the transition to a low-carbon economy.
It uses a free online tool that helps asset owners track investments and companies on how they are managing their greenhouse gas emissions.
The strategy also sets expectations for publicly-listed companies and large asset owners to disclose how climate change risk impacts their activities by 2022.
Glen said the government was already leading by example on this.
“Publicly-funded financial bodies must include climate-related disclosures in their accounts as soon as possible,” he said.
“Hundreds of companies are also disclosing details of how they are mitigating climate risk on a voluntary basis.
“[But] I want to go further, which is why I’m calling on all public-listed companies and large asset owners to do the same.”
Emma Howard Boyd, chair of the UK Environment Agency, said she welcomed the strategy and the opportunities it presented.
“The World Economic Forum’s Global Risks Report ranks extreme weather events number one. This presents a massive investment opportunity in technology, infrastructure, and expertise to protect people and businesses,” Howard Boyd said.
“We want to build international partnerships and position the UK supply chain at the forefront of this market.”