Recommendations & Conclusions
10 items
8
Recommendation
First Report - The financial sector and…
Deferred
We welcome the Government’s intention to consult on requiring companies to disclose transition plans. However, the current “comply or explain” basis should be for an interim period only: a company can disclose by simply not having a transition plan, defeating the point of the policy.
Government response. The government is supporting the Transition Plan Taskforce (TPT) and will hold an upcoming consultation to consider the UK's approach to transition plans and the role of the TPT's Disclosure Framework, without committing to ending 'comply or explain'.
9
Recommendation
First Report - The financial sector and…
Deferred
We agree with the Government that the operating environment will become increasingly difficult for those firms that do not set out their plans for contributing to net zero. However, we do not think it is enough to leave the issue of transition planning to the market. The UK led the …
Government response. The government established the Transition Plan Taskforce (TPT) to create a gold standard for private sector climate transition plans and will hold an upcoming consultation to consider the UK’s approach, including the TPT’s Disclosure Framework.
10
Recommendation
First Report - The financial sector and…
Deferred
The Government’s consultation on requiring companies to disclose transition plans should include consideration of making it compulsory to have and to disclose a transition plan—not just if a company happens to have one—and the most suitable timetable for doing so. Beyond this consultation, mandatory reporting of transition plans should remain …
Government response. The government details existing work by the Transition Plan Taskforce and the FCA on transition plan disclosures. They state an upcoming consultation will consider the UK’s approach to transition plans, including the TPT Disclosure Framework and endorsement of ISSB standards, …
11
Recommendation
First Report - The financial sector and…
Deferred
We welcome the publication of the Transition Plan Taskforce’s disclosure framework for transition plans, and the steps taken to achieve international alignment of that framework. We believe that those who publish transition plans should follow a compulsory framework, to ensure comparability and to mitigate the risk of greenwashing. While investors …
Government response. The government established the Transition Plan Taskforce (TPT) and will hold an upcoming consultation to consider the UK’s approach to transition plans and the role of the TPT’s Disclosure Framework, without committing to introducing regulations for compliance.
12
Recommendation
First Report - The financial sector and…
Deferred
A plan is only effective if it delivers its contents. The Government should set out simple, consistent regulatory expectations for net zero transition plans and establish an independent mechanism for monitoring and evaluating and verifying organisations’ net zero transition plans, to ensure that they are aligned with Paris Agreement compliant …
Government response. The government established the Transition Plan Taskforce (TPT) and will hold an upcoming consultation to consider the UK’s approach to transition plans and the role of the TPT’s Disclosure Framework, without committing to specific regulatory expectations or an independent monitoring …
17
Recommendation
First Report - The financial sector and…
Deferred
To maintain the UK’s global leadership in green finance reporting, the Government must keep up the momentum. We recommend that Ministers set out an overarching implementation timetable for the SDR, including for TNFD reporting, and commit to making TNFD reporting mandatory, continuing the trail the UK blazed for TCFD. The …
Government response. The government reiterates its commitment to Sustainability Disclosure Requirements (SDR) and confirms it will consider how best to incorporate the Taskforce on Nature-related Financial Disclosures (TNFD) recommendations into UK policy, deferring a commitment to a specific timetable or mandatory TNFD …
19
Recommendation
First Report - The financial sector and…
Deferred
We recommend that the Government seek to introduce the UK green taxonomy as soon as possible. That taxonomy should include a spectrum of definitions—‘fifty shades of green’, as one of our witnesses put it. During the period of voluntary reporting against the green taxonomy, the Government should monitor and report …
Government response. The government commits to publishing a consultation on the UK Green Taxonomy shortly and will implement a voluntary disclosure period for at least two reporting years before considering mandatory obligations. It does not explicitly address the recommendation for a "spectrum …
20
Recommendation
First Report - The financial sector and…
Deferred
It is unfortunate that, due to the delays to the introduction of the green taxonomy, the remit of the Green Technical Advisory Group expired before the testing period of voluntary disclosures could begin. We urge Ministers to heed the group’s calls for a long-term institutional home for the UK green …
Government response. The government acknowledges the Green Taxonomy Advisory Group's advice and states it will consider what external advice is required going forward, following a forthcoming consultation. It does not commit to establishing a long-term institutional home for the UK green taxonomy …
22
Recommendation
First Report - The financial sector and…
Deferred
The Government must keep to its ambition of setting out its future plans for net zero blended finance solutions by the next spending review, and should include nature recovery projects within this suite of solutions. The Government should set out in one document all its different blended finance models, cross-checking …
Government response. The government announced the Net Zero Blended Finance Project in November 2023, which aims to improve its capacity to explore innovative blended finance approaches and mobilise private investment for net zero technologies. However, the response does not explicitly commit to …
25
Recommendation
First Report - The financial sector and…
Deferred
We recommend that the Government go further and turn this research into a formal tracking mechanism by a date no later than the end of the current Parliament. The Government should task either an existing independent body, or create a new 62 The financial sector and the UK’s net ero …
Government response. The government acknowledges the need for tracking investment flows and states that the scoping phase for a UK Landscape of Climate Finance (LCF) model has concluded. It is now considering next steps, including the potential role of an independent body, …