COP26 private financiers initiative a 'rebranding exercise'

Molly Scott Cato passes judgement on the scheme proposed at COP26, labelling it as an opportunity in which financiers will be ‘marking their own homework’.




COP26 Financial Alliance
COP26 Financial Alliance

UNFCCC_COP26_1Nov21_HLActionSolidarity_KiaraWorth-22 (CC BY-NC-SA 2.0)

Green World

The Green Party has responded to the launch of the Glasgow Financial Alliance for Net Zero at the 2021 United Nations Climate Change Conference (COP26), decrying the initiative as merely an opportunity for financiers to mark ‘their own homework.’

The plan led by Mark Carney, former Governor of the Bank of England, will provide participating members of the financial sector with a scorecard to mark the amount of net zero goals each has met.

Molly Scott Cato, the Green Party of England and Wales’ Finance and Economy spokesperson, says the initiative provides encouragement for greenwashing. To tackle this, government regulation and political oversight are required in place of private initiatives – including requirements for the termination of fossil fuel subsidies and the introduction of carbon taxes. 

There is a potential conflict of interest in the rollout of the scheme, underscoring Carney’s advocacy of fossil finance – in his role as Vice Chairman and Head of Impact Investing at Brookfield Asset Management – as contradictory to the ethos of sustainability.

Scott Cato comments: “To be part of this net zero club, financial institutions are required to measure their investment against a net zero pathway, but they will be undertaking that measurement themselves. Yet again we are seeing financiers marking their own homework. They may give themselves a smug A* but the world’s citizens are giving them a big fat fail as they continue to finance the very industries that are driving us to destruction.

“Without strong regulation and political oversight by democratic authorities there is nothing to prevent this cosy bankers’ club from descending into greenwashing. The most urgent shift we need to see for finance to justify itself as “sustainable” is an end to all investments in fossil fuels. Yet this new Alliance will allow investments in dirty coal in the Global South and has fallen for fossil fuel industry spin about gas as a transition fuel.

“This new Alliance is a rebranding exercise by the finance sector when what we need to see is strong action from governments who should immediately end fossil fuels subsidies and make polluters pay with a high and rising carbon tax.

“How can we have somebody whose day job is seeking to profit from the sustainability transition be responsible for designing the rules of the carbon market? Climate protesters have rightly focused their attention on banks and finance companies, who have been bankrolling the pathway to extinction in recent years.”