CashNews.co
We were delighted to host the U.K. Transition Finance Market Review’s (TFMR) flagship event at New York Climate Week, in partnership with the City of London Corporation who host the TFMR secretariat. The session offered a fascinating insight into how different jurisdictions are approaching transition finance, as well as business leaders’ perspectives on the opportunities and challenges of driving real-world decarbonization impact.
This event was situated at the start of a critical period of heightened focus on transition finance, which will be a top priority of the upcoming United Nations Climate Change conference (COP29) in Baku, Azerbaijan.
The event was opened by the Rt Hon Ed Miliband MP, Secretary of State for Energy Security and Net Zero, and featured keynote speeches from Vanessa Havard-Williams, Chair of the TFMR and a representative from a U.K. regulator. The event also featured two panel sessions providing international perspectives and industry views on transition finance. The first comprised speakers from financial regulators, international financial institutions and intergovernmental organizations, while the second featured representatives from market infrastructure providers, utilities, private capital and financial services.
This event foreshadowed the publication of the TFMR’s recommendations for scaling transition finance. The TFMR is an independent market review commissioned by U.K. Government, to explore how the U.K. can support the scaling of a high-integrity transition finance market in support of global net zero ambition.
We are delighted to have served as legal advisor to the TFMR’s secretariat on a pro bono basis and we are committed to using our legal expertise to accelerate an economy-wide transition.
Here, we summarize the key takeaways from the event.
The broad reach of transition finance
Three key observations stood out:
- Transition finance is needed across the whole economy, to bring about a safe and orderly attainment of net zero goals, without placing financial stability and just transition considerations at risk.
- It must touch every sector of the economy (including high-emitting sectors) and must not bypass intermediary industries and industries in emerging markets and developing economies (EMDEs), including those which have a key role in global supply chains.
- Growth in transition finance at entity-level, not just activity-level, is needed to accelerate decarbonization in line with national, regional and global net zero targets.
The U.K.’s ambition on transition finance
The U.K. has an ambition to become a global hub for transition finance. In that context, HM Treasury and the Department for Energy Security and Net Zero commissioned the TFMR to look at how to grow transition finance in the U.K. and support companies in the U.K. and abroad to access the necessary finance to deliver on net zero ambitions.[1]