UN hails UK for green finance innovation

14 Jan 16

The United Nations has praised the UK for taking the lead in many areas of green and environmentally sustainable finance.

A report by the UN’s Environment Programme’s Inquiry into the Design of a Sustainable Financial System commended the UK for a distinctive model of innovation in sustainable finance based on a close interaction between social entrepreneurs, mainstream financial institutions and, increasingly, financial policy and regulation.

Nick Robins, co-director of the UNEP inquiry and co-author of the report, said: “It is striking just how many key global initiatives are clustered in London – whether on responsible investment, green bonds, unburnable carbon, sustainable banking, climate disclosure or insurance risk.”

The report pointed to a number of firsts in sustainable finance achieved by the UK. In 2000 the UK became the first country to require pension funds to state whether they took social and environmental issues into account.

Last year, the Bank of England’s Prudential Regulatory Authority also undertook the world’s first review of the implications of climate change for the insurance sector.

The City of London Corporation will launch a new Green Finance Initiative, which aims to make London a centre of green finance later today, at an event co-hosted by the City and the UNEP, whose report will also be presented.

While the report concludes the UK is taking the lead in many areas, it also said sustainability could be seen as a “sleeping giant” of its financial system and sets out a number of priorities for the UK.

These include: establishing a green bond hub to take the UK’s position as one of the top issuers of environmental bonds forward and a rethink of housing finance to reduce energy costs and environmental impacts.

Read Public Finance’s interview with the Green Investment Bank’s Shaun Kingsbury

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