Climate Change and the environment have been in the public focus over recent years and have proven disruptive to many markets. Consumer pressure is mounting upon on all products and supply chains, most notably in the electrical vehicle revolution. In finance this has lead to an increase in “Green Reporting” and disclosures by many leading companies in their financial statements. The FCA has launched a discussion paper into how the increasing green agenda will impact financial services and investment in the medium and long term, with comments due 31 January 2019. NCM has a longstanding association with green investments, with its Hydro Electric Fund, partnered with Gilkes Energy, showcasing the excellent investment opportunities the sector has to offer.
The Discussion Paper will focus on four areas where the FCA considers a greater regulatory attention is warranted:
· climate change and pensions – ensuring that those making investment decisions take account of risks including climate change
· enabling competition and market growth for green finance
· ensuring that disclosures in capital markets appropriately give adequate information to investors of the financial impacts of climate change
· the scope for the introduction of a new requirement for financial services firms to report publicly on how they manage climate risks
Andrew Bailey, Chief Executive at the FCA said, “Climate change presents a disruptive and potentially irreversible threat to the planet. The impact of climate change on financial markets is uncertain but legal frameworks – at a global, European and UK level – have already begun to adapt to reflect a move to a low carbon economy. The FCA can play a key role in providing more structure and protection to consumers for green finance products and ensuring that the market develops in an orderly and fairway which meets users’ needs.”