Fund managers warn government over net zero target
Update
Fund houses managing £1.5trn in assets have written to the government warning that confused policymaking could cut off investment required to hit the net zero target by 2050.
Their letter cited doubt cast in recent weeks by Prime Minister Rishi Sunak on plans to ban sales of new petrol and diesel cars by the end 2030, only for cabinet minister Michael Gove to describe the ban later that day as ‘immovable’.
According to The Times, the fund houses’ letter argues that confusion around green policies could stop the finance sector investing the £50bn to £60bn a year needed to hit the emissions goal.
The letter has been signed by 36 financial institutions who are members of the UK Sustainable Investment and Finance Association (UKSIF), including Jupiter Asset Management, Royal London and Scottish Widows.
UKSIF CEO James Alexander said ‘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.’
The group of investors wants the government to provide a more reliable stance on long-term policy areas such as building energy efficiency standards, carbon-pricing mechanisms, and the transition to electric vehicles.
UKSIF’s Alexander said institutional investors need consistent messaging to invest confidently in new, green-focused areas.‘The problem is,’ he said, ‘as soon as the government starts making comments or noises suggesting that this might not actually be the direction of travel after all, it saps the confidence of private investors, and we need their money to make this transition possible.’
Link: https://www.investmentweek.co.uk/news/4123556/fund-managers-warn-government-net-zero-target-reports