Stay up to date with notifications from The Independent

Notifications can be managed in browser preferences.

Financial institutions and listed firms to be forced to publish net-zero plans

Chancellor Rishi Sunak said the UK would become a net-zero financial centre.

Geraldine Scott
Wednesday 03 November 2021 00:01 GMT
Chancellor Rishi Sunak (Stefan Rousseau/PA)
Chancellor Rishi Sunak (Stefan Rousseau/PA) (PA Wire)

Financial institutions and listed companies will be forced to publish their plans on how they will transition to net zero, in sweeping reforms the Chancellor hopes will halt so-called greenwashing.

Rishi Sunak is set to reveal in a speech on Wednesday plans to make the UK a net-zero financial centre.

Speaking at the Cop26 summit in Glasgow Mr Sunak is expected to outline how new rules will be drawn up by a task force with members from universities, civil society groups, industry and regulators.

The plans will need to include high-level targets to reduce greenhouse emissions, the steps companies plan to take to get there and milestones ahead of 2050.

But although the plans will need to be published, the aim is simply to increase transparency.

It comes as Boris Johnson said he was “cautiously optimistic” about the prospects for a deal at crucial international talks to curb global warming.

On the second day of the summit, the Prime Minister welcomed a series of announcements by the assembled leaders on deforestation and emissions.

But he stressed there was still a long way to go if they were to get an agreement that would keep alive the prospect set out in the Paris Agreement of restricting world temperature rises to 1.5C.

Ahead of the summit, Mr Johnson suggested that humanity was 5-1 down at half-time in the battle against climate change.

But speaking at a press conference on Tuesday, he said: “We’ve pulled back a goal, or perhaps even two, and I think we are going to be able to take this thing to extra-time, because there’s no doubt that some progress has been made.”

He added that while the “doomsday clock is still ticking”, they now had a bomb disposal team on site and “they’re starting to snip the wires – I hope some of the right wires”.

Mr Sunak will say on Wednesday that around 40% of global financial assets have aligned themselves to limit global warming to 1.5C above pre-industrial levels.

As finance ministers meet in Glasgow, Mr Sunak hopes the plans will be a greenwashing-proof new “gold standard” which will not allow companies to boast about their eco ambitions without backing them up with action.

But the Government will leave it up to the market to determine if transition plans put forward by firms are adequate or credible.

Companies will be expected to start publishing their transition plans in 2023.

Earlier, the Prime Minister acknowledged that the issue of climate finance had yet to be resolved – despite a 10 billion dollar (£7.3 billion) commitment from Japan over five years.

Mr Johnson said the richer nations were still behind on a commitment first made at Paris in 2015 to transfer 100 billion dollars (£73 billion) a year to developing countries to support sustainable development and mitigate the inevitable effects of global warming.

“What I’ve been asking for, as you know, is action on coal, cars, cash and trees, and after just a couple of days we can certainly begin to tick three of those boxes,” the Prime Minister said.

Mr Johnson was returning to London after the end of the two-day leaders’ event which opened the summit, but he made it clear he would continue to be engaged.

In a message to the remaining teams who will get down to the task of detailed negotiations, he said: “The eyes of the world are on you – the eyes of the British Government and all the other governments that care about this – and we have got your numbers.”

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged inPlease refresh your browser to be logged in