A new report published today [24 May] by the City of London Corporation and Climate Policy Initiative (CPI) has revealed that UK financial institutions are frontrunners in both setting defined climate goals and in implementing climate action, along with the US, and ahead of France, Switzerland and Germany.

The report, Pathway to Net Zero Report, showed the UK-based GFANZ members were the only ones among organisations in the top five GFANZ participating countries that both accelerated their shift away from new fossil fuel investment and increased climate-related investment. Investment from UK GFANZ members in climate solutions has increased by 57% between 2018 and 2020. This includes investments that directly contribute to reduction of greenhouse gas emissions and climate adaptation, e.g. renewable energy, carbon capture and storage technology.

The report is being launched by the Lord Mayor of the City of London, Nicholas Lyons, at the second annual Net Zero Delivery Summit (NZDS). The Net Zero Delivery Summit is co-hosted by the City of London Corporation and the Egyptian COP27 Presidency and will convene government representatives, global financial and corporate leaders, and sustainability experts from around the world to turn commitments made at previous COPs into actions ahead of COP28 in Dubai.

The report, which provides an overview of progress amongst the over 550 members of the Glasgow Financial Alliance for Net Zero (GFANZ), revealed the UK was a leader in target-setting with all UK-based GFANZ members having adopted a climate target, a sharp rise from 15% in 2020.

However, it found that although almost all UK GFANZ members have made encouraging overall progress between 2020-2022, around the world implementation of climate action is still mostly at the planning stage. Institutions that made the most progress in implementation had greater engagement with their clients and shareholders on climate change and provided better transparency on their targets.

Lord Mayor of the City of London, Nicholas Lyons, said:

“It’s of no surprise to me that UK financial firms are leading the way on their climate commitments. Over the last ten years, the UK’s financial services have been creating the product innovations which have been instrumental in delivering our, and the wider world’s, carbon neutral initiatives.

“But there is still more to do if we’re going to avoid the worst effects of climate change. That is why I’m proud to be hosting the second Net Zero Delivery Summit alongside our Egyptian partners. The financial service sector has a crucial role to play in unlocking the private capital needed for the world to transition to net-zero.”

Policy Chairman at the City of London Corporation, Chris Hayward, said:

“Climate change is a global challenge, and we will not overcome it unless we make progress together. Around the world, roughly 140 countries have set net-zero emissions targets by mid-century. If fully achieved this would account for over 90% of global greenhouse gas emissions.

“These commitments are a great first step, but they require action and that requires financing, about $100 trillion or more between now and 2050. It is impossible for governments to provide this type of financing and that’s why this summit is vital in helping to ensure the financial service sector around the world turn their commitments towards net-zero into action.”

Ambassador Mohamed Nasr, Egypt's Chief Climate Negotiator and Director of the Department of Environment, Climate and Sustainable Development said:

"The Egyptian COP27 Presidency is pleased to partner with the City of London Corporation in holding NZDS 2023, which was announced at the Egyptian Pavilion at COP27 and focuses on one of the priorities of the COP27 Presidency, namely just transition. Just transition is a crucial pillar for delivering on the needed at scale and ambitious climate action, one of the key elements recognized in the Paris Agreement and a core principle within the UNFCCC process. It means ensuring that global and local climate action protects the planet, people and the economy and does not expand development gaps both at national and international levels. The creation of just transition work program for discussion of pathways to achieving the goals of the Paris Agreement was one of the key outcomes of COP27. It was a response to the strong calls by many in the climate change community and reflects the need to ensure just pathways for delivering mitigation and adaptation actions that secure social and economic development and deliverables, thus leaving no one behind." 

The report showcases the importance of a combined role of data and delivery in addressing climate change and calls for a greater collaboration between private and public sectors worldwide to promote adoption of climate finance goals, policy engagement, and better transparency of investment and emission data.

These issues will be discussed at the Net Zero Delivery Summit, which will feature speakers including COP27 High Level Climate Champion Dr Mahmoud Mohieldin, Ambassador Majid Al Suwadi, Director General and Special Representative of COP28 Presidency, Rt. Hon. Chris Skidmore MP, Chair of the All Party Group on the Environment, Prime Minister of Barbados Mia Mottley, Dr Rhian-Mari Thomas OBE, Chief Executive, Green Finance Institute and Elizabeth Maruma Mrema, Assistant Secretary-General of the United Nations.

Keynote speeches are expected to highlight the urgency of getting finance flowing to the nations which need it most, scaling high integrity voluntary carbon markets, implementing climate action strategies powered by the global economy and the opportunities of wholesale economic transformation.

ENDS

Supportive quotes

Jim Colvine, SVP, Priceless Planet at Mastercard: 

“To tackle the climate crisis and shift to a greener economy, we need immediate and progressive action from the private sector, the public sector and civil society. There’s no shortage of innovation and ideas that can transform the economy. We have the tools we need – this summit will showcase them so we can work together and make progress faster.”

Lynne Baber, PwC UK Sustainability Leader said:

"The financial services sector has an enormous role to play in ensuring that the world’s climate goals are met, through supporting mitigation, adaptation and resilience by mobilising the capital that is required to deliver a fair and inclusive transition. "That is why PwC is delighted to be sponsoring the Net Zero Deliver Summit, where the financial and professional services sectors will hear more about how we can meet these crucial targets."

James Wilde, Chief Sustainability Officer, Phoenix Group, said: 

"The financial services industry has the size and scale to make a significant contribution to the transition to net zero - but to harness its firepower, cross-sector collaboration and solutions-based action are crucial. The Net Zero Delivery Summit is an important opportunity for finance leaders and policy makers to come together to discuss the best practice and pioneering solutions that can accelerate the pace of climate action."

Notes to editors

• The embargoed Pathway to Net Zero: Tracking UK financial services progress in climate transition report can be found here. The report uses 2022 data from the Net Zero Finance Tracker (NZFT) developed by the CPI, is an in-depth assessment of how public and private finance institutions are working to meet their Paris Agreement and net zero goals.

• The Net Zero Delivery Summit (NZDS) 2023 is co-hosted by the City of London Corporation, in association with the COP27 Egyptian Presidency, to mark the halfway point between COP27 in Egypt and COP28 in the United Arab Emirates. The summit focuses on how tackling climate change and its effects on societies can be delivered in a fair and inclusive way, particularly in developing countries. The NZDS agenda and speaker line up can be found here.

• The City of London Corporation is the governing body of the Square Mile dedicated to a vibrant and thriving City, supporting a diverse and sustainable London within a globally successful UK. www.cityoflondon.gov.uk 
• The first Net Zero Delivery Summit was held in May 2022, at the halfway point between COP26 and COP27. The Summit brought together nearly 200 leaders in climate finance, from industry, policy makers, and regulators. Speakers included: John Kerry, US Special Presidential Envoy for Climate; Mark Carney, GFANZ co-Chair; The Rt Hon Sir Alok Sharma, COP26 President; Rania Al Mashat, Egypt’s Minister of International Cooperation, and many more.
• GFANZ was launched in April 2021 by UN Special Envoy on Climate Action and Finance Mark Carney and the COP26 presidency, in partnership with the UNFCCC Race to Zero campaign, to coordinate efforts across all sectors of the financial system to accelerate the transition to a net-zero global economy.