British Chancellor Rishi Sunak met with G7 finance ministers and central bank governors on Tuesday April 6 to discuss the role of finance in supporting the net zero transition and implored developed countries to step up efforts to generate $ 100 billion in annual revenue to support developing countries tackle the climate crisis. Reports Edie.net, EURACTIV media partner.
Chancellor Sunak hosted the finance ministers’ meeting as part of the UK’s G7 presidency. Accompanied by Bank of England Governor Andrew Bailey, the Chancellor implored nations to set themselves and move towards net zero goals.
The meeting was also used to discuss the importance of developed countries in meeting the commitment to mobilize $ 100 billion in annual funds to help developing countries mitigate the effects of the climate crisis while integrating technologies and low carbon markets.
Under the UNFCCC, developed countries have pledged to fund $ 100 billion per year by 2020, but developed countries have not honored this commitment, with as little as $ 70 billion provided during the last years. Some of the funding has also been issued in the form of repayable loans, rather than grants, meaning developing countries will have to repay at some point.
The meeting was the first in a series of high-level political discussions taking place this week that will feature the main discussions ahead of COP26 in November this year. Later this week, Sunak is expected to call on the G20 to support the International Monetary Fund in mainstreaming climate change into its financial activities.
Further discussions should also encourage banks, including multilateral development banks, to align with the tracks of the Paris Agreement.
Some have already started this journey. the Net zero asset managers initiative Now covers more than a third of assets under management worldwide, after the listing of 43 big names, including BlackRock and the Vanguard group.
The initiative, which commits members to achieving zero net funded emissions by 2050 or earlier, announced over the weekend that it now has more than 70 members, collectively representing $ 32 billion in assets under management. .
The meeting also saw discussions take place on improving climate-related financial reporting and increasing support for the creation of global standards for sustainability-related financial reporting.
The UK government, for example, is considering creating a legal obligation for UK private companies to describe and disclose climate-related risks to their business, in line with the recommendations of the Taskforce on Climate-related Financial Disclosures (TCFD), with a mandate that can come into effect next year.
Large swathes of the UK financial sector will be subject to these new demands, including major pension schemes, life insurance providers and asset managers.
In fact, the government this week sent a letter to the Financial Conduct Authority (FCA) and the Prudential Regulation Committee (PRC), which oversee financial services companies, imploring them to report on the net zero goal as part of the framework. an update of the resets.
This follows the publication of the updated mandates for the Bank of England’s Monetary Policy Committee (MPC) and the Financial Policy Committee (CPF) in the 2021 budget, which again seeks to enshrine net zero in financial decision-making.