A group of financial firms led by ex-Bank of England Governor Mark Carney has called on G20 governments to set out more detailed plans to decarbonise their economies.
The Glasgow Financial Alliance for Net Zero (GFANZ) has urged policymakers to publish transition plans with sector-specific strategies and provide clarity about the policies that would be enacted to support them.
“While finance is very much leaning into the challenge of supporting the transition to net zero, you can’t be a substitute for government action,” said Alice Carr, executive director of public policy at GFANZ.
The intervention comes ahead of COP27 in Egypt starting on the 6th of November. While 19 of the G20 countries have set net zero targets to curb climate change, current policies are not enough to help meet the world’s climate goal, according to the non-profit Climate Watch, an open data platform is managed by World Resources Institute (WRI)
As a result of the energy disruption caused by Russia’s war in Ukraine, several EU nations, including France and Germany, have reopened or extended the lifespan of coal plants.
GFANZ said it is ‘imperative’ that governments explain how ‘any new, short-term reliance on fossil fuels’ will be accommodated within longer-term transition plans consistent with science-based pathways. They must also provide appropriate timelines for transitioning energy systems to clean alternatives, the alliance said.
The Net-Zero Banking Alliance (NZBA), part of GFANZ was recently called out during Climate Week NYC by a global coalition of NGOs, demanding more stringent rules on financing fossil fuel projects
Over the last year, GFANZ has begun to build out a series of tools and frameworks to assist members in making the transition, including in helping define how aligned an investment portfolio is with the climate goal.
Last week, GFANZ, a coalition of asset managers, banks and insurance firms representing $150 trillion in assets, said it would no longer require members to sign up for a U.N. emissions reduction campaign.
That move had drawn criticism from climate activists over who would hold the financial industry to account over its climate commitments.
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