Source · Select Committees · Treasury Committee
Recommendation 24
24
A taxonomy is an important part of identifying what can be considered green investment, so...
Conclusion
A taxonomy is an important part of identifying what can be considered green investment, so the announcement of a UK taxonomy is welcome. The Treasury and regulators should work at speed to ensure that there is a clear timetable and legislative pathway to deliver a UK taxonomy ahead of COP26 in November 2021. The UK can utilise the EU’s taxonomy but can exceed it when it will assist the UK’s goals. The UK should seize the opportunity presented by COP26 to use its own work on a taxonomy to push for greater international convergence. (Paragraph 192) 56 Net zero and the Future of Green Finance
Government Response
Acknowledged
HM Government
Acknowledged
In November 2020, the Chancellor announced that the UK would implement a Green Taxonomy to create a common understanding of which economic activities are environmentally sustainable, improving understanding of the impact of firms’ activities and investments on the environment. On 9 June, Government launched a Green Technical Advisory Group to provide independent advice on taxonomy development and implementation This will include advising on how to ensure the metrics and thresholds which underpin the taxonomy (Technical Screening Criteria) are based on robust science, and are practicable and suitable for the UK market. Finally, the Chancellor has made sustainability disclosures a key priority of this year’s G7 Finance Track and secured ambitious commitment for G7 countries to work closely together and with international partners to determine the best approach to ensure global consistency in environmental impact reporting. HM Treasury is also actively involved in the International Platform on Sustainable Finance. The Government is required to make Technical Screening Criteria via secondary legislation for climate change mitigation, and climate change adaptation no later than 1 January 2023. These TSC will be subject to appropriate, open consultation prior to making. In addition, the Government will publish a Roadmap setting out the approach to green finance regulation ahead of COP26.