Aldersgate Group reacts to the updated Green Finance Strategy

Reacting to the publication of the updated Green Finance Strategy and the natural markets framework, Nick Molho, Executive Director at the Aldersgate Group, said: “This strategy is a positive step towards delivering the world’s first net zero-aligned financial centre in the UK, balancing strong ambition with a consideration for the needs of businesses to ensure compliance. It is particularly encouraging to see plans to consult on a requirement for the UK’s largest companies to disclose their net zero transition plans, which is a vital measure to create a level playing field for business and ensure quality market information. The commitment to deliver the UK Green Taxonomy also represents important progress. Moving forward, it is crucial that this is introduced as a mandatory requirement over time and takes a science-based approach, to provide clarity for investors and create a high-ambition baseline. Similarly, the publication of a nature market framework is a significant development, establishing vital principles and rules to grow natural capital markets whilst setting out a trajectory for clarifying and developing institutional and regulatory roles.”

Reflecting on what must come next, James Fotherby, Policy Officer at the Aldersgate Group leading on green finance, said: “To build upon this encouraging update, the Government should provide a clear timetable and further details on the implementation of the Sustainability Disclosure Requirements to tackle greenwashing and inform investors’ financial decisions. Clarifying the role of the Green Technical Advisory Group in the delivery of the UK Green Taxonomy will also be key to ensure effective co-ordination. Throughout the implementation of all new measures and regulatory changes, Government must work with business to understand what compliance means for them, and support their transition to net zero.”

James Fotherby added: “In light of the increasing global competition for low-carbon investment, it is welcome to see the Government taking steps to strengthen the UK Government’s position with an industry-led market review into how the UK can become an international leader in raising transition capital. Similarly, plans to publish sector-specific net zero investment roadmaps are a positive step forward, providing an opportunity to accommodate the unique needs of different economic sectors and drive finance towards their decarbonisation.”