In a joint statement, the FCA, the FRC, the BoE and the TPR have welcomed the Government’s updated Green Finance Strategy.
Managing the risks and opportunities associated with climate change is crucial to maintain the resilience of the financial system, the integrity of UK markets, and ensure a smooth and effective transition to net zero. The regulators have stated that they have a “key” role in understanding the financial risks and opportunities relevant to our mandates and establishing and maintaining credible standards, which can also facilitate mobilising finance to support the transition and enable the Government to achieve its ambitions to foster the world’s first net-zero aligned financial centre.
Furthermore, they stated that as part of their coordinated response to the Green Finance Strategy, their cross-regulatory working group will continue to ensure coordination in cross-regulator delivery of green finance ambitions.
FCA chief executive officer, Nikhil Rathi, commented: “We welcome this updated Green Finance Strategy, which represents an important milestone, building on collective efforts to date and setting out a clear plan for the future. We are working hard to ensure that the UK market is well positioned to support the transition to net zero. We’re playing our part in delivering a world-leading framework for transition plan disclosures through our collaboration with the UK Transition Plan Taskforce.
“We’re putting the right information in the hands of investors by working closely with the International Sustainability Standards Board. And we’re continuing our work to help consumers through product labelling. We look forward to continuing to work closely with government and regulators to support the delivery of the Green Finance Strategy.”
FRC chief executive officer, Jonathan Thompson, added: “We all need to play our part in the net zero transition and ensure that the economy is resilient and prepared for managing climate-related risks. As the regulator for company reporting and audit, the FRC will continue to hold organisations to account for transparent disclosures on their plans and actions to address climate risks and opportunities.
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“Reliable information, free from greenwashing, and subject to high-quality assurance is critical both to public trust and the effective functioning of capital markets and the success of the Green Finance Strategy. We look forward to continuing our collaboration with other regulators in support of the UK’s ambitions.”
Bank of England governor, Andrew Bailey, concluded by adding: “Climate change affects our planet, our economy and our financial system. It is undeniably relevant to the Bank of England and the objectives it is tasked to meet. We are working to ensure that the macroeconomy, the financial system, and the Bank of England itself are resilient to the risks from climate change and support the transition to net-zero.
“We therefore welcome, and are proud to have contributed to, the UK Government’s updated Green Finance Strategy – a strategy that will help to deliver the cross-economy transition that will be required to meet net zero.”