Thursday 23 February 2023

‘UK must act now to become world’s net zero financial hub’

Imminent action is needed if the UK is to become the world’s leading net zero financial centre.

That’s the claim of the Green Technical Advisory Group (GTAG), tasked with advising the government on how a green taxonomy should be implemented in the UK.

It stresses that clear standards need to be set for green finance, to grow the job market and consolidate the country’s position as a leader in the economic sector.

The report states there are too many taxonomies that are unable to work together – and without alignment cross-border capital flows and investment in green assets will not be as fluid.

Developing a taxonomy that promotes cross-border investing should be a top priority for the government, GTAG urges.

This would spread the amount of green finance flowing through the UK and abroad – but new guidelines would also be needed to clearly outline what qualifies as sustainable investment.

Consistent evaluation of the UK Green Taxonomy against the rest of the world is also needed, to ensure the country remains ahead of the trend.

GTAG Chair Ingrid Holmes said: “Building on its strong track record in world-leading green finance policy, the UK is well placed to help address the challenge of global market fragmentation, while at the same time securing its leadership on green finance through a scientifically robust and usable taxonomy.

“This is particularly important given the UK’s globally focused financial sector, which has some of the deepest pools of internationally oriented capital, with 7.2% of the global total of foreign listed companies listed in London. But the UK must act now.”