Nick Lyons

Amanda Latham

My Australian friend Amanda Latham, has joined IFM, the Australian infrastructure manager set up by Australian pension schemes to improve returns for DC savers. She’s known to many of us as one of the architects of TCFD while at the Pensions Regulator and an advocate for sustainable investment while at Barnett Waddingham.

Her role will be to ensure Australian savers make their money matter, by investing in the environmentally sustainable projects that can save the planet and improve retirements.

Coincidentally, this  subjects under discussion  by the Lord Mayor of the City of London in Citywire yesterday. Here’s what he’s got to say, I hope that it’s more than Australians listening.

Addressing the impacts of climate change, and making ourselves resilient to them, requires even more than what governments are able to offer, writes Nicholas Lyons.

Anyone opening a newspaper over the last few months will have seen the headlines – forest fires, droughts, floods. Addressing the climate crisis can seem like an uphill battle. But in the City there is cause for optimism. Business is putting its money where its mouth is: since 2021 GFANZ members, who hold $85tn of private capital, have made commitments to hitting net zero emissions targets by 2050. They include more than 550 financial institutions, insurers, and asset managers across 45 countries.

This is what I’ll be discussing at the City of London Corporation’s annual Net Zero Delivery Summit (NZDS) at Mansion House this week. The Summit will convene government representatives, financial and corporate leaders, and trailblazing climate solution providers from around the world.

It’s impossible for governments alone to provide the scale of financial support required to address the challenge. Even the $370bn worth of investment, grants and subsidies in the US Inflation Reduction Act is a fraction of what is needed.

But what the US has got right is the role that financial incentives play in unlocking investment in key industries for decarbonisation. There has been recent news that the development of the UK’s electric car battery industry is under threat, and we saw the collapse of battery manufacturer Britishvolt earlier this year. A more concerted effort is needed to direct capital into these crucial new industries.

But it’s still a long road between here and unlocking the significant investment required. I agree with Chris Skidmore’s recommendation to review how policy can incentivise investment in decarbonisation via the tax system and capital allowances.

While investment in emerging sectors is important, we mustn’t forget the pivotal role of transition finance in delivering net zero. From aviation to transport, we will only achieve net zero if the owners of high-emitting assets are supported in their efforts to decarbonise. Assigning a scarlet letter of shame to these industries will not help us reach our climate goals.

We need to ensure companies at different stages of their journey towards decarbonisation are still able to access private finance. Not just to support their day-to-day activities, but also to facilitate their effort to reduce emissions in a manner that is financially and environmentally sound.

Net zero is the growth opportunity of the 21st century, worth up to £1tn to UK businesses by 2030. Positioning the UK as the go-to partner for countries and companies looking for capital and expertise and ensuring we have the right policies in place can empower us to reap these rewards.