CGFI has featured in a number of UK announcements this October ahead of COP26 including in the Net Zero Strategy, the HMT Greening Finance roadmap, and the DWP consultation on Climate and Investment Reporting.
The Net Zero Strategy highlights how CGFI is a critical part of the UK’s comprehensive approach to greening the global financial system, together with other major initiatives and programmes to green regulation, supervision, skills, norms, standards, metrics, and support the emergence of new green finance products, structures, and vehicles.
CGFI is part of the UK’s Green Technical Advisory Group (GTAG) established to provide independent advice on market, regulatory and scientific considerations around developing and implementing the UK’s Green Taxonomy. In the Greening Finance roadmap HMT set out next steps for the taxonomy, including the introduction of mandatory sustainability disclosures across the economy that will incorporate the requirement to disclose net zero transition plans. CGFI will help inform the implementation of these new sustainability reporting requirements, including through GTAG.
In the DWP consultation on Climate and Investment Reporting, UK pension fund trustees will be required to calculate and disclose portfolio alignment metrics describing the extent to which their investments are aligned with the Paris Agreement. This includes metrics tracking the percentage of investments that have already reached net zero. This is important as being on track to being net zero (the focus of many methodologies) is not the same as actually being already net zero today. We will develop an open source tool for this metric and have also been tasked with establish a working group to support the development of these ‘net zero today’ tracking methodologies and tools for portfolios.