Simon McWhirter, Director of Communications, Policy and Places at UKGBC said:
“We strongly welcome plans unveiled by the Chancellor today requiring financial institutions and listed companies to publish net zero transition plans from 2023. These announcements send a clear signal to the market and businesses across our sector – and beyond – about the clear direction of travel we need; and it adds to the significant momentum that is building around the net zero transition.
The new Transition Plan Taskforce will be critical in ensuring organisations bring forward credible high-quality plans, underpinned by robust, science-based standards to prevent greenwashing. Many of UKGBC’s members are already leading the way by signing up to the Race to Zero, and therefore committing to halving their emissions by 2030. This represents an essential goal if businesses are to help limit warming to 1.5 degrees.
However, it’s disappointing that clear requirements for firm-wide, net zero targets aligned with industry best-practice are not currently mandatory under these plans. Clarity around enforcement and accountability will be critical if such plans are to be seen as credible. In addition, significant public investment will be crucial for mobilising solutions at scale and encouraging private investment, particularly in the built environment. We therefore support industry calls for a National Retrofit Strategy to unlock the full potential of the sector to deliver a green jobs revolution.”
Under the new Treasury rules, financial institutions and companies with shares listed on the London Stock Exchange must come up with net-zero transition plans, which will be published from 2023. The strategies will need to include targets to reduce greenhouse gas emissions, and steps which firms intend to take to get there.
To guard against greenwashing, a science-based ‘gold standard’ for transition plans will be drawn up by a new Transition Plan Taskforce, composed of industry and academic leaders, regulators, and civil society groups. And although the plans will need to be published, the government said “the aim is to increase transparency and accountability” and the UK was not “making firm-level net-zero commitments mandatory”.
$130 trillion – around 40% of the world’s financial assets – is now being aligned with the climate goals in the Paris Agreement, including limiting global warming to 1.5C. The Commitments have come from over 450 (financial) firms from all parts of the financial industry, based in 45 countries across six continents, and have been delivered through the Glasgow Financial Alliance for Net Zero (GFANZ), which was launched by the UK.”
The Chancellor’s plans for the UK to become the world’s first net zero financial centre can be accessed here.
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