Source: Bank of England

Businesses and the citizens from across the UK have had their say on how the financial sector can help tackle climate change as part of a new Bank of England (Bank) initiative to engage with external stakeholders on climate change.

Climate change continues to be a key strategic priority for the Bank, which has an ambitious work programme that ranges from assessing climate-related financial risks of the largest UK banks and insurers through to working internationally with the Network for Greening the Financial System, a network of more than 80 central banks. Its objective is to build a UK financial system that is resilient to the risks from climate change and supportive of the transition to a net-zero economy.

Sarah Breeden, the Bank’s Executive Director Sponsor for climate change, has led two virtual events this month designed to increase understanding and engagement on the issue:

• Business leaders event on 14 January 2021, was attended by more than 650 businesses who are contacts of the Bank’s network of Agents across the UK; and
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• Citizens’ Panel event on 26 January 2021, which saw around 70 members of the Bank’s Citizens’ Panels participate in a series of small discussion sessions and a Q&A with Bank staff.

A poll at the event for businesses exploring the main drivers for companies to take positive action on climate change revealed that more than half of respondents (52%) felt that the primary motivator for their business to transition to net-zero emissions was a ‘moral obligation’. The other most popular responses were ‘commercial opportunities from the transition’ (22%) and ‘regulatory or legal requirements’ (20%).

Asked to identify the biggest obstacle they faced in transitioning their businesses towards net-zero emissions, 38% pointed to a ‘lack of organisational capacity’, and 27% cited a ‘lack of detail over government climate policy and regulatory barriers’.

At the event for Citizens’ Panel members, participants discussed how climate change is affecting their day-to-day lives and how the financial sector can support them and businesses transition to net zero. Around half of those voting (52%) said the main reason for supporting climate action was to ‘protect the environment’. When asked what they felt was the main driver for organisations to take positive action, the most popular answer was regulatory or legal requirements (45%) and that ‘customers demand it’ (36%).

Demand for places at the Citizens’ Panel event was so high that there are plans for further sessions. Anyone interested in taking part should sign up for their local panel.

Sarah Breeden, the Bank’s Executive Director Sponsor for climate change, said:

“Since climate change affects all of us, it is essential to broaden the conversation to engage companies, large and small and from all sectors, as well as people of all ages and backgrounds. This was a great opportunity to listen to different perspectives on how we can collectively make a difference, and to explain why this all matters so much to the Bank of England. These events have demonstrated that there is a great deal of interest in and support for the role the Bank is playing in facilitating action on climate change.”

Will Dowson, the Bank’s Agent for Scotland, who chaired the sessions, said:

“Our discussions with businesses and not-for-profit organisations increasingly include their own climate initiatives. These events helped our business contacts and our Citizens’ Panel members hear what the Bank is doing more generally to support the financial system and broader economy on climate action. But more importantly it gave us the chance to hear views on climate action directly and learn more about what people and businesses are doing and would like done.”

Peter Ryder, of Thornton’s Law in Dundee, who attended the business event, said:

“Our customers want to understand what we are doing to support climate action and we are keen to understand what more we can do as a business. Hearing how the Bank of England is approaching this and the work it is doing with banks and insurers was really helpful to learn about.”

Tracey Grayhurst, 52, a member of the Bank’s Citizens’ Panel for Central Southern England, said:

“To be part of such an innovative and interesting forum was brilliant. Climate change requires immediate action by us all. Droughts and floods will devastate crops which in turn threatens food security and the extreme weather events such as wildfires and hurricanes will cause loss of habitats and housing and add to people’s health being compromised. The financial sector needs to take action to provide help with the research into energy efficiency, renewables and switching to low CO2 fuels and gases and by providing green mortgages and loans.”