Government warned about investment loss to net zero target


Fund managers responsible for £1.5 trillion in assets recently wrote to the UK government, warning that confusion around policymaking could shut down investments which are needed to achieve Britain’s 2050 net zero target.

Among the points bulleted in the letter was the planned ban on new cars powered by diesel and petrol by the close of 2030. Doubt was recently cast on this policy by UK prime minister Rishi Sunak, however cabinet minister Michael Gove has described the initiative as an “immovable” one.

Confusion surrounding this, and many other green policies, could see the finance sector cease to invest in the £50-£60 billion required per year, to reach the country’s current emissions goal according to fund houses.

From individual consumers to corporations, those seeking to fund ESG projects often take independent financial advice in Chester, Birmingham and other cities. Wealth managers are IFAs, and help ethical investors select assets for their portfolios that reflect their stance on environmental issues.

The letter, addressing the prime minister, was signed by 36 different financial institutions. The fund managers are all members of the UKSIF, UK Sustainable Investment and Finance Association.

CEO for UKSIF, James Alexander, commented:

“The global competition to capture billions of pounds of private investment in the clean industries of the future is intense. Ministers’ recent remarks are undermining investor confidence and putting the UK’s net zero head start at risk.”

The fund houses want the government to supply a more stable stance regarding long-term policies for carbon-pricing mechanisms, energy efficiency standards and the transition to electric vehicles.

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