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The UK goes ahead with mandatory climate plans for companies



(Reuters) – The UK unveiled a new working group on Monday to write rules forcing financial companies and listed companies to publish next year’s plans for the transition to a net zero economy by 2050.

Last November, at the UN climate summit COP26, British Finance Minister Rishi Sunak said that companies must publish a plan from 2023 with goals to mitigate climate risks, intermediate goals between now and 2050 and measures to meet them.

It is part of the UK’s commitment to make the country the world’s first net zero – adjusted financial center.

The working group will develop “rigorous and robust” measures to tackle greenwashing ̵

1; inflate green credentials – and help companies establish “investable and responsible” transition plans, the Treasury said in a statement on Monday.

“Preventing the worst effects of climate change will require all companies to develop ambitious, consistent transition plans to bring us to a low-carbon future,” said Amanda Blanc, CEO of insurance company Aviva and co-chair of the new Transition Plan Task Force.

The British Chancellor of the Exchequer John Glen, who co-chaired the working group with Blanc, said it would be up to investors to assess whether the companies’ plans were adequate and credible. The government will publish its transition path for the financial sector later this year, he said.

Banks are under pressure to abolish financing for fossil fuel companies.

“The idea that we can turn off the cranes for fossil fuels tomorrow is obviously ridiculous and naive,” Bill Winter’s Standard Chartered bank manager told CityWeek.

“Firstly, it will not happen, and secondly, it would be very destructive. Good for climate change, but I’m afraid it would be bad for war, revolutions and human rights because you would have devastation,” Winters said.

Michael Sheren, senior adviser to the Bank of England, told CityWeek that a price for coal needed to be linked to how much it would cost companies to switch to net zero.

Steve Waygood, chief investment officer at Aviva Investors, said valuations of companies would be incorrect until this was done.

Valuations of companies will only be accurate once the price of coal has been embedded in them and this required government action to mandate it, Waygood said.


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