The Green Party has passed a hard-hitting new policy to deprive
the fossil fuel sector of investment finance and accelerate the
transition towards clean forms of energy [1].
Celebrating the passing of the new policy at the Party’s Spring
conference, Green spokesperson on finance and economy Molly Scott
Cato said:
“In spite of all the fine words from financiers in Glasgow at the
COP26 climate summit, our largest banks are still pumping
billions into new oil and gas production, pursuing dirty profits
and putting the lives of our grandchildren at risk [2].
“This motion means the government will have to put its money
where its mouth is on the climate crisis. They will need to bring
forward rules and regulations that force the UK finance sector to
clean up its act and play its part in the rapid transition away
from fossil fuels. Banks, stock markets and other financial
actors need to shift finance towards the sustainable sectors of
the green economy.
“It is time to hold UK banks to account, starting at the top,
with the Bank of England. A condition of holding a UK banking
licence must be the presentation of an investment strategy
outlining a clear pathway to divest from fossil fuel
assets.
“With UK pension funds holding around £128 billion in fossil fuel
assets, regulation is also desperately needed to eliminate fossil
fuel assets from securities portfolios, pensions and insurance
products.”
“The finance sector has for too long been funding climate chaos
and this has been diverting finance from investing in a healthier
and cleaner economy. The pursuit of dirty profits means that we
will all pay the price. It’s time for us to ensure that banks
play their part in the transition to a green
economy.”
ENDS
Notes
-
Key elements of the new policy:
- The Bank of England will be
required to produce a climate roadmap for the financial system;
with no bank holding a UK banking licence permitted to invest in
new fossil fuel development; UK pension and investment funds will
be required to remove fossil fuel assets from their investment
portfolios.
- The Bank of England should adopt a
policy of credit guidance with minimum but rapidly increasing
quotas of lending to fund a just but urgent sustainability
transition.
- We will introduce credit
bans/ceilings for unsustainable activities. These targets will be
mandatory for all banks relying on the central bank as a lender
of last resort.
- The Bank of England’s mandate will
be changed so that funding the sustainability transition becomes
a central objective, alongside the maintenance of price
stability.
- The UK will adopt a position in
negotiations at the Basel Committee that fossil fuel assets will
be subjected to higher risk weights and capital surcharges until
their value as collateral is gradually eliminated.
2.
https://www.bbc.co.uk/news/business-60366054
