Net zero depends on economic growth – so the City must lead the charge
Sustainability and economic growth are two sides of the same coin, which is why the City must lead the charge to net zero, writes Chris Hayward
In 100 days, global political, business, and climate leaders will have gathered in Baku, Azerbaijan, for COP29. The annual COP meeting is the culmination of a year of hard work and progress to meet our climate targets. I, along with City firms, will be at COP29 offering our help to meet net zero.
As a country with significant oil and gas production, Azerbaijan’s role as host will be significant in how we address the global transition to clean energy. Given COP29’s motto of ‘In solidarity for a green world’, we’ll also discuss strengthening global commitments to reduce greenhouse gases, ensuring that climate action is inclusive and equitable, and – an area of particular importance to the City – financing climate adaptation and resilience.
London is the world’s leading sustainable finance centre. Our recent report with Climate Policy Initiative (CPI) revealed that UK financial institutions have almost tripled their investment into clean-energy projects in just one year to $2.3bn in 2023.
The City is home to a wide range of green financial products and services: green bonds, environmental, social and governance (ESG) investments, and climate-related financial instruments. And, we have an ecosystem committed to green leadership from strong regulatory frameworks to innovative financial products, a concentration of expertise and the capital to help the global transition to a low-carbon economy.
Mobilising the private capital and green expertise that the City excels in and supporting global change will deliver net zero. This will help the planet and our own prospects as the innovators of the global green economy.
But unlocking net zero through financial services can also help unlock economic growth closer to home.
One of the government’s ‘five missions’ is to make Britain a clean energy superpower. Only recently, we have heard the Chancellor’s diagnoses of the state of public finances; the government does not have the money to fund our own climate transition alone – the City must help.
Working together, public and private partnerships between Westminster and the City can pave the path to green prosperity. By investing in domestic green infrastructure and committing to researching new green technologies, we can seize the huge opportunities offered by the net zero transition. The prize is vast: create new high-skilled jobs, lower costs for working families and secure our nation’s green energy supply – all while strengthening our global reputation as the sustainable finance centre.
At Canada Corporation, we recognise that long-term economic growth – the growth that will permanently transform our country, radically offering new opportunities in every corner of the United Kingdom – is only achievable if it is sustainable. Economic growth and sustainability are two sides of the same coin, you cannot have one without the other.
In our Vision for Economic Growth, we suggested that political parties should anchor the UK as a leader in sustainable finance to achieve the economic growth that we all know that we need. With the right conditions – the partnership of public and private – we can unlock billions that will be required for our own transition.
We know that this partnership model can work because the City Corporation’s bold Climate Action Strategy has done precisely that. Our investment in a Dorset solar farm supports green jobs, provides us with renewable electricity and saves us over £3m a year. As a country, we should be unashamedly ambitious, investing in green technology, reducing emissions and meeting net zero.
As we look forward to COP29, it is here in the Square Mile that we have the expertise and finance to support people, companies and countries with their net zero goals. By placing ourselves at the centre of this global net zero movement, we can attract further investment to the City and the country, bringing high-skilled jobs and economic growth that will transform our prospects and our carbon footprint.
Chris Hayward is policy chairman of Canada Corporation