UK fleshes out its approach to the green finance agenda
The broader role of financial regulation in the green transition and ESG policy-making is the subject of a discussion paper published on February 10 by the UK’s FCA. The FCA is exploring firms’ sustainability-related governance, incentives, competence and stewardship arrangements and the evolution of firms’ processes to achieve positive sustainability outcomes. The FCA is interested in hearing from firms about how to move beyond disclosure-based initiatives in contributing to a net-zero economy. In particular, the FCA touches on how governance, incentives and competence are considered in the Taskforce on Climate-related Financial Disclosures (TCFD) recommendations, and how expectations are evolving with the work of the International Sustainability Standards Board, the UK’s Transition Plan Taskforce and the Glasgow Financial Alliance for Net Zero, as well as sustainability training in regulated firms. Comments are due by May 10, 2023.
The paper comes after the UK Government committed to publish an updated Green Finance Strategy in 2023 and consult on bringing ESG ratings providers into the regulatory perimeter as part of the UK Chancellor’s Edinburgh Reforms in December 2022.
On February 21, the Chief Secretary to the Treasury John Glen MP delivered a speech in which he underlined the ongoing work the UK is undertaking to accelerate the adoption of robust standards for investing in a broader range of ecosystem services, including the integration of climate change considerations into the work of the UK’s financial regulators.
Bloomberg
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