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Mark Carney to advise Boris Johnson on climate change

·Senior City Correspondent, Yahoo Finance UK
Mark Carney,
Mark Carney will take up the role of climate adviser to the UK government after he steps down as the Bank of England governor in March. Photo: Kirsty Wigglesworth/AFP via Getty Images

Bank of England governor Mark Carney has been appointed as an official adviser to prime minister Boris Johnson on climate change finance.

The Bank of England and the Cabinet Office said on Thursday that Carney would advise the prime minister on how the financial system can help the UK reach net zero carbon emissions. He will take up the role once he steps down from the Bank of England in March.

The appointment comes ahead of the United Nation’s Climate Change conference, known as COP26, which will be held in November in Glasgow.

“Mark Carney is an invaluable addition to the COP26 team,” the prime minister said in a statement announcing the appointment. “His expertise will help the UK to lead in mobilising businesses and investors to support our net zero revolution.”

Carney has made addressing climate change through finance a key priority in recent years. He first raised the financial risk posed by warming temperatures in a speech in 2015 and has committed to introducing regular climate risk tests for big banks.

READ MORE: Bank of England head: Pension funds could be hit by 'worthless' fossil fuels

His work led him to be appointed as the United Nations special envoy for climate action and finance. He will take up the role when he steps down from the Bank of England, earning a token $1 a year in the role.

Carney said in a statement on Thursday he was “honoured” to advise the prime minister ahead of COP26.

“The combination of these critical meetings and the UK’s global leadership in financial services provides a unique opportunity to address climate change by transforming the financial system,” he said.

“To seize it, all financial decisions need to take into account the risks from climate change and the opportunities from the transition to a net zero economy.”

The Bank of England said Carney will focus on creating new rules and measurements that would “bring the impacts of climate change to the mainstream of private financial decision making.”

The Bank of England estimates as much as $20tn (£26tn)-worth of assets could be at risk from climate change and Carney said last month pension funds could be hit as fossil fuel investments become “worthless” in the near future.

READ MORE: Mark Carney lands first post-Bank of England job

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