Globalising green finance

The UK as an international hub

The vision for the UK is to be a collaborative global hub for green finance: the go-to place to connect capital with green results through accessible, innovative and reliable products and services. The financial sector will support Government leadership on green by embedding the environmental imperative across its business models and markets, in line with national and global green priorities. The UK’s global role in green finance can in turn be an engine for domestic green growth and decarbonisation.

The UK already benefits from deep and broad world-leading financial expertise, a concentration of dedicated green finance institutions and teams, high-profile figures leading thinking and discussion at the global level and the experience of a track record in green finance innovation and leadership.

This report presents a six point plan from the GFI  and the UK’s wider green financial community to enable the UK to meet its full green financial potential.

The recommendations for government and industry

  • Set a clear path: environmental objectives will only be met if government and industry works together to set a holistic green finance strategy. This could include giving powers to a new or existing independent body to set a long-term path for a greener UK economy; developing open-access green corporate benchmarks; and completing the work undertaken to develop green infrastructure as an asset class.
  •  Strengthen data and transparency: engage in regulatory green forward guidance, extend the analysis and understanding of climate-related risks, and work to implement the findings of the Financial Stability Board’s Task Force on Climate-related Financial Disclosure.
  • Promote voluntary principles: maintain the market’s integrity whilst removing barriers and permitting it room to grow. Work with industry, government, regulators and other financial centres to establish guidelines and consistency, and build upon the success of the green bond market in other areas, such as green tagging for loans.
  • Enable connection and collaboration: work to globalise green finance through international best practice, learning and cooperation. Facilitators could include dedicated bilateral or multilateral green financial discussions; a network for the world’s leading green financial centres; and public-private, cross-border secondee programmes.
  • Embed change: ensure that money managers, analysts, consultants and the financial leaders of the future can address climate-related risk and explore green financial opportunities. This will require the inclusion of environmental awareness right across the financial sector, from fiduciary duty, stewardship and governance guidelines to relevant professional and university qualifications.
  • Public sector leadership: provide certainty of persistent government support for a low-carbon transition. The UK could lead in this area by building green objectives and metrics into its Industrial Strategy, for example;  and further building upon the successes of the International Climate Fund.