U.K. Plans to be Hub for Global Voluntary Carbon Markets, Joins With Singapore (1)

By Mathew Carr

July 1, 2021 — (London): The British government is seeking to position the U.K. as the leading global market for “high-quality voluntary carbon offsets”.

This effort will be led by Dame Clara Furse’s newly established UK Voluntary Carbon Markets Forum, Treasury said today in statements on its website.

See links here: https://www.gov.uk/government/news/chancellor-sets-out-how-uk-financial-services-can-create-prosperity-at-home-and-project-values-abroad-in-first-mansion-house-speech

and here:

Yesterday, the U.K. and Singapore jointly agreed to accelerate green finance and encourage the development of carbon markets.

Both countries reaffirmed the importance of interoperability of taxonomies to facilitate cross-border sustainable financial flows and will work towards identifying compatibilities in the UK and Singapore taxonomy principles and metrics for green and transitional activities. The UK and Singapore also discussed ongoing efforts to tackle climate change, where they welcomed commitments from financial institutions across the world, including via the Glasgow Financial Alliance for Net Zero (GFANZ). See link below.

Following Brexit, the U.K. lost the EU carbon market business on ICE, which shifted the volume to its Dutch unit.

A ‘world leader’ in Green Finance?

In a speech, the British Chancellor Rishi Sunak announced plans to require companies, pension funds, financial services firms and their investment products to report on the impact they are having on the climate and environment – as well as the risks and opportunities facing their business.

The text: These new integrated Sustainability Disclosure Requirements will bring together and streamline existing climate reporting requirements and go further to ensure consumers and investors have the information they need to make informed investment decisions and drive positive environmental impact. The Government intends to legislate to deliver this and will set out its approach to green finance regulation ahead of COP26.

And with over 70% of people saying they want their investments to avoid harm and achieve good for people and the planet, the Government will also work with the Financial Conduct Authority (FCA) to create a new sustainable investment label – a quality stamp – so that consumers can clearly compare the impacts and sustainability of their investments for the first time.

Details have also been announced on the types of green projects that will be eligible for funding when the UK issues its first ever sovereign green bond, known as a green gilt, later this year, and a world-first green savings bond offered by NS&I, with yesterday’s publication of the UK Government Green Financing Framework.

Green projects like zero-emissions buses, offshore wind and schemes to decarbonise homes and buildings will be eligible for funding, with at least £15 billion of green gilts issued this financial year alone.

These two products will give both investors and savers across the UK the opportunity to join the collective fight against climate change and other environmental challenges, reinforce the UK’s position as a world-leader in green finance, and create new jobs in green technologies across the country.

Photo by Stanislav Kondratiev on Pexels.com

U.K., Singapore join forces: https://www.gov.uk/government/publications/uk-singapore-financial-partnership/joint-statement-on-uk-singapore-6th-annual-financial-dialogue

(Adds Singapore deal)

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