Chancellor of the Exchequer Rishi Sunak has updated the remits of the UK’s principal financial regulators so that they take into account the UK government’s legally binding commitment to transition to a net-zero economy by 2050.
In his recommendations to the Financial Conduct Authority (FCA) announced Wednesday, Sunak said the government wanted “a financial system which supports and enables a net-zero economy by mobilising private finance towards sustainable and resilient growth and is resilient to the physical and transition risks that climate change presents”.
He added: “The FCA should have regard to the government’s commitment to achieve a net-zero economy by 2050 under the Climate Change Act 2008 (Order 2019) when considering how to advance its objectives and discharge its functions.”
The chancellor’s recommendations for the Bank of England’s Prudential Regulation Committee, the body that takes the Prudential Regulation Authority’s most important decisions, made a similar point.
Earlier, on 3 March, the chancellor updated the remit of the Bank of England’s Monetary Policy Committee and updated the remit for its Financial Policy Committee, which both also reflected the importance of environmental sustainability and the transition towards net zero.
— Oliver Rowe (Oliver.Rowe@aicpa-cima.com) is an FM magazine senior editor.