Asset managers and pension funds representing $65trn in assets have called on the UK government to accelerate net-zero transition plans – including the development of a whole-of-government plan and implementing a supportive financial regulatory environment – to unlock green investment and increase competitiveness.
Today the Institutional Investors Group on Climate Change (IIGCC) outlined priorities for policymakers to “pivot permanently towards decarbonisation, channelling efforts into the effective delivery and implementation of policies that support this”, or risk falling behind on delivering legally-binding net-zero targets, and losing its status as a “climate leader” in the increasingly competitive global race to attract capital.
See also: Supportive policy and regulation could boost UK sustainable finance by £100bn AUM
Emily Murrell, policy director at IIGCC, commented: “In this important election year, investors are looking for a supportive policy environment that provides the confidence and certainty needed to make long-term investments in the UK’s transition to net zero.
“The building blocks of a sustainable finance framework are beginning to fall into place, but there is an urgent need to move ahead with swift implementation of key pieces of legislation.”
In the report IIGCC Call to Action for UK Government 2024, members have called for five areas to be prioritised:
– Develop a whole-of-government approach with a centralised strategy to facilitate delivery of net zero targets.
– Devise a comprehensive green industrial strategy that supports the decarbonisation of the UK economy and boosts economic competitiveness.
– Increase the UK’s adaptation and resilience to growing climate impacts.
– Embed the delivery of a nature-positive transition into the UK policy framework.
– Implement a supportive financial regulatory environment which facilitates capital flows towards climate and nature goals.
“Success depends on near-term decisive actions and well-designed policies, effective coordination between relevant stakeholders, and a renewed commitment by the next government to achieving net zero goals, with a particular emphasis on prioritising decarbonisation within the real economy,” added Murrell. “Doing this early in the next government’s term will open up avenues for increased private finance towards the low-carbon transition, fostering a more sustainable and resilient future.”
Meanwhile, Tessa Younger, stewardship lead for environment at CCLA, said: “The IIGCC Call to Action emphasises the urgent need for a comprehensive, ‘whole-of-government’ approach to sectoral decarbonisation, providing the certainty investors require to fund the UK’s low-carbon transition. With the general election approaching, it’s crucial for the government to demonstrate commitment to these pathways, keeping the UK at the forefront in climate action and boosting the economy.”
IIGCC has over 400 members including Abrdn, Aegon UK, Artemis, Baillie Gifford, BlackRock, EdenTree, Fulcrum, Goldman Sachs, CCLA, Invesco, Rathbones and JP Morgan Asset Management to name a few.
Today’s call to action echoes statements released by the UK Sustainable Investment and Finance Association (UKSIF), which has been campaigning for the government to accelerate climate policies for the past few years.
