The UK government has commissioned the new Green Technical Advisory Group to produce a guide to clarify what can and cannot be classified as sustainable investment, in an effort to curb the greenwashing of companies.
The Green Technical Advisory Group will include representatives from academia, charities and industry. It will develop a “green taxonomy” to set the bar for sustainability.
Hundreds of sustainable investment funds are launched each year in light of increased consumer and corporate interest in environmental protection, but it can be challenging to compare these funds, which often use a range of different metrics to make and support their eco-friendly claims.
“We want investors and businesses to play their part in greening our economy and transitioning to net zero, so it’s critical that we have a clear common definition of what green means,” said John Glen, economic secretary of the United Nations. Ministry of Finance.
“A UK green taxonomy will provide better data on the environmental impact of businesses, support investors, businesses and consumers in making green financial decisions and accelerate the transition to net zero.
“I look forward to the advice of the expert Green Technical Advisory Group in implementing a rigorous taxonomy that works for the UK and sets a high standard globally.” A Treasury statement said:
“The green taxonomy will help combat greenwashing — unsubstantiated or exaggerated claims that an investment is eco-friendly — and make it easier for investors and consumers to understand how a company affects the environment.
” Last year, the EU developed its own green taxonomy that used six factors to assess products for sustainability, such as pollution control, biodiversity restoration and decarbonisation. The EU taxonomy included nuclear energy as a sustainable product:
the UK group will include a subgroup (the Energy Working Group) to assess how nuclear, hydrogen and carbon capture should fit into the taxonomy. The Green Technical Advisory Group will be chaired by the Green Finance Institute and will include representatives from the CBI;
the independent committee on climate change; the London Stock Exchange; LSE and WWF. It will meet for the first time this year and run for at least two years. It will make its first set of recommendations to the government in September.
However, the group’s conclusions will be advisory only and ministers will not be bound by any particular path.
Energy Minister Anne-Marie Trevelyan commented: “This will help the financial sector invest in the projects, technologies and services of the future, cementing the UK’s position as a global leader in green finance and tackling climate change.
” strengthens.” Ingrid Holmes, Executive Director of the Green Finance Institute, added: “The [group] will play a key role in advising the Government on how to implement a robust science-based taxonomy adapted to the specific needs of the UK context and works for everyone. stakeholders.
“In the absence of quantitative guidance on terms like ‘green’, ‘sustainable’ and ‘net zero’, companies have used their own definitions, often unhelpfully selectively.
Recently, Carbon Tracker found that of the 10 largest oil companies, seven had yet to set themselves climate goals that included decarbonisation.