The government has announced its Green Finance Strategy, setting out plans to increase investment in sustainable projects and infrastructure.
Ministers say the strategy is also a call for collective action, setting out how the UK will work with industry, regulators, academia and international partners to deliver the urgent and far reaching change that is needed.
The strategy, says the government, will ensure financial risks and opportunities from climate change are integrated into mainstream financial decision making, and increase availability of finance to bring together the UK’s low carbon and environmental expertise and the financial services sector.
Making the announcement at the third Green Finance Summit in London earlier this week, economic secretary to the Treasury and city minister John Glen argued that financial services will have a bigger role to play than any other sector in tackling climate change.
The news follows hot-on-the-heels of UK becoming the first G7 country to legislate to move to net zero emissions by 2050. The government says the UK has shown that going green can be a win-win, reducing emissions by 42% while growing the economy by 72%.
Ministers have also committed to spend at least £5.8bn on International Climate Finance, encouraging other nations to act on climate collaboratively. This, says the government, builds on the £3.87bn that the UK spent on climate activities between 2011 and 2015.
The Green Finance Institute, co-funded by the government and the City of London Corporation, was also launched at the summit, with the Institute aiming to create new opportunities for mobilising finance for sustainable projects around the world – and will lead on the City of London’s Green Finance partnerships with countries including India.
London’s financial heartland already welcomes Indian organisations looking to access green financing, with Indian issuers having raised £1.5bn on the London Stock Exchange through green bonds over the past two-and-a-half years – including through Indian Renewable Energy Development Agency’s (IREDA) £216m green masala bond.
The UK and Indian governments have also established the Green Growth Equity Fund, which intends to raise capital from institutional investors for investment in green and renewable energy projects in India.
John Glen, economic secretary to the Treasury and City minister, said: “We need to do more to protect our planet for future generations, and the City [of London] has a vital role to play in securing a greener future for us all. By investing more in sustainable projects it can not only protect our environment, but also help establish London as the pre-eminent international centre for green finance. The UK’s Green Finance Strategy will support this ambition, with new initiatives to boost funding for green ventures and ensure the environment is at the centre of all financial decision-making.”
Emma Howard Boyd, chair of the Environment Agency, welcomed the strategy, and said: “This presents a massive investment opportunity in technology, infrastructure, and expertise to protect people and businesses. The international trade secretary recently announced UK Export Finance and the Environment Agency will work together to help UK suppliers with expertise in adaptation and delivery of infrastructure projects and services around the world. We want to build international partnerships and position the UK supply chain at the forefront of this market.”