A new independent group to fight against “greenwashing”

  • creation of a new group of independent experts to advise on green investment standards

  • UK Green Taxonomy is part of the government’s efforts to improve the environment, accelerate the transition to net zero and create green jobs

  • better data will help businesses, investors and consumers make informed green choices, support investments in sustainable projects and step up efforts to tackle climate change

The Green Technical Advisory Group (GTAG) will oversee the government’s implementation of a “green taxonomy” – a common framework setting the bar for investments that can be defined as environmentally sustainable.

Green taxonomy will help tackle greenwashing – unsubstantiated or exaggerated claims that an investment is environmentally friendly – and make it easier for investors and consumers to understand a company’s impact on the environment. .

With hundreds of new sustainable investment funds brought to market each year and sales to UK retail investors tripling from 2019 to 2020, consumers and investors of all sizes will be able to make more informed decisions, and businesses will be supported in their plan to transition to net zero.

The Green Taxonomy is an important step in the government’s efforts to boost investment in projects that accelerate the transition to a sustainable economy, create green jobs and support UK environmental goals.

The Green Technical Advisory Group (GTAG) will provide independent, non-binding advice to government on the development and implementation of a green taxonomy in the UK context.

The GTAG will be chaired by the Green Finance Institute and comprised of financial and business stakeholders, taxonomic and data experts, and subject matter experts from academia, NGOs, the Agency for environment and the Climate Change Committee.

John Glen, Economic Secretary to the Treasury, said:

We want investors and businesses to play their part in greening our economy and transitioning to net zero, so it is essential that we have a clear common definition of what green means.

A UK green taxonomy will provide better data on the environmental impact of businesses, helping investors, businesses and consumers make green financial decisions and accelerating the transition to net zero.

I look forward to receiving expert advice from the Green Technical Advisory Group as we put together a rigorous taxonomy that works for the UK and sets a high standard globally.

Ingrid Holmes, Executive Director of the Green Finance Institute, said:

The GTAG will play a key role in advising the government on the implementation of a strong, science-based taxonomy tailored to the specific needs of the UK context and working for all stakeholders.

We are delighted to chair the GTAG and welcome the 18 members on board, all of whom have a demonstrated interest and / or track record of being engaged on the issue of taxonomic development and use, and on the aspect practice of applying a taxonomy in a specific UK context.

UK Energy Minister Anne-Marie Trevelyan said:

Transforming our financial system for a greener future is vital so that we can protect the planet, achieve net zero and grow our economy, and the creation of a Green Technical Advisory Group and an Energy Working Group are two crucial steps in the development of our green taxonomy in the United Kingdom.

This will help the financial sector to invest in the projects, technologies and services of the future, thus strengthening the UK’s position as a global leader in green finance and fighting climate change.

The government will also establish an energy working group under the GTAG to provide advice on key technologies such as hydrogen, carbon capture, use and storage, and how to approach nuclear energy in taxonomy – a key component of UK net zero plans. . Other expert groups can also be created as needed as the work progresses.

Chancellor Rishi Sunak first announced that the UK will implement a green taxonomy in November 2020, as part of broader plans to position the UK at the forefront of green finance, including issuing the UK’s very first sovereign green bond later this year.

GTAG’s launch comes shortly after the UK played a pivotal role in leading G7 countries to move towards climate disclosures – in line with recommendations from the Climate-Related Financial Disclosures Task Force (TCFD ) – mandatory in their respective economies.

The deal was reached at a meeting of G7 finance ministers chaired by the Chancellor last weekend and comes after the UK was the first country in the world to commit to making the climate reports aligned with TCFD by 2025.

More information

  • Further details on the role of GTAG and EWG, including their respective members, are available online.

  • HM Treasury, the Financial Conduct Authority, the Bank of England and other relevant government and regulatory departments will be observers to GTAG

  • The GTAG will meet for the first time in June 2021 and is expected to last at least two years. It will provide first recommendations to the Government in September 2021

  • More details on the G7 agreement on TCFD-aligned climate disclosures can be found here

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