THE Square Mile will soon be home to a Green Finance Institute as the UK strives to raise the $93trillion it needs to meet its climate change commitments.
Chancellor of the exchequer Philip Hammond made an announcement this month that the Treasury would be partnering with the City of London Corporation to co-fund the institute to champion sustainable finance in the UK and abroad.
The UK leads the charge in the green finance market with close to 80 green bonds raising more than $24billion (£18bn) across seven currencies.
But the Global Commission on the Economy and Climate Change estimates around $93trillion (£70tn) of global infrastructure investment between 2015 and 2030 will need to be green in order to meet climate change commitments.
“It is my ambition that the UK leads the world in financing this investment,” said Mr Hammond.
“We are establishing a new Green Finance Institute here in London, jointly funded by government and the City of London Corporation, so that firms from across the world can access our one-stop-shop for world-leading climate science, and for capital.”
The institute, which will be based within the City of London Corporation, was one of the key recommendations from the Green Finance Taskforce’s report published in March.
The body will drive forward the UK’s green finance market and play a vital role in the UK’s international engagement on financial services, especially in emerging markets where green finance demands are growing rapidly.
The green bond market grew by 78% between 2016 to 2017, to $155bn (£117bn) in issuances.
Announcing the institute, City policy chief Catherine McGuinness said the financial district was ready to act as a green champion.
“This will bring together the UK’s existing capabilities, create new business opportunities, and communicate to the wider market what London’s offer is in green finance and insurance. “Promoting this is not only good for business but is good for the world; helping tackle one of our greatest challenges – global warming.
“London is already a world leader in green finance, and this institute, a key recommendation of the Green Finance Taskforce, will ensure we remain so for years to come.”
Cover image by EU2017EE Estonian Presidency (Creative Commons).
