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‘This is the end of the beginning for finance’: Mark Carney speaks at COP26 along with global finance leaders

·3-min read
Mark Carney is now the Prime Minister‘s finance adviser for Cop26 (PA Archive)
Mark Carney is now the Prime Minister‘s finance adviser for Cop26 (PA Archive)

Former Bank of England governor Mark Carney has said he believes Cop26 could be the "end of the beginning" for the global finance sector's attitude to the climate crisis.

Carney, who is now the Prime Minister's finance adviser for Cop26, is running global project the Glasgow Financial Alliance for Net Zero.

Speaking at the Green Horizon Summit running alongside the conference in Glasgow on Tuesday, he said: "I think this is the end of the beginning for finance. In other words we come together now moving from climate as risk to finance as a solution."

Launched earlier this year and convened by the UN, GFANZ gets financial institutions to commit to net-zero carbon emissions by 2050. It is also focused on providing the cash the world needs to make investments towards a global net-zero economy.

The project spans the sector and has already got commitments from firms representing over $90 trillion. Signatories will report on the emissions of their investee companies and borrowers annually as well as reducing their own emissions. The list of companies will be released on Wednesday.

Carney has said the world "must build a financial system entirely focused on net zero", and that firms signing up support “a wholesale rewiring of the global financial system so that every financial decision takes climate into account".

The expert argues that trillions of dollars of capital must be mobilised to pay for decarbonisation in developing countries.

In Paris in 2015 more developed countries promised to pay $100 billion per year to those that are less developed. This pledge is far from being achieved. Many financial institutions are also still investing in fossil fuel firms.

Global finance bosses also appeared at the green summit on Tuesday.

The co-founder, chairman and CEO of asset management giant BlackRock, Larry Fink, told a panel that private companies need to match public firms in making big commitments to cutting carbon emissions if the world is to reach net-zero.

Fink said he is "very impressed by how fast public companies are moving forward" in reporting their emissions data.

But he warned: "If we don't ask society to move forward, if we don't ask private companies to move forward alongside public companies, we won't get to net zero... [For Governments] asking public companies to do this is pretty convenient, but asking private companies and the rest of society to move forward is much harder.

"My fear is that we're moving public companies much faster than the rest of society, and that's going to lead to a more polarised outcome.”

The CEO said he believes "we are going to see more regulatory change to ask more companies to report" in future.

He concluded: "We have to be open minded about what it's going to take [to reach net-zero]. We have to look beyond the window-dressing of just a commitment... we have to have the public and private world working together to come up with solutions. It is going to require an enormous amount of investment in the emerging world."

Standard Chartered chair Jose Viñals, LSE chief executive David Schwimmer and NatWest CEO Alison Rose also spoke at the roundtable.

Viñals said he wants to see a market established where carbon credits can be traded.

Arguing the move would be a "win-win", he said: "I think they are going to be very important.

"I think serious consideration should be given to that as a complement, not as an alternative, to cutting emissions.”

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