BoE speech: financial markets and the fight against climate change

Andrew Hauser, BoE Executive Director for Markets, has spoken about the role capital markets, including asset managers, have to play in the fight against climate change.

In his speech, Mr Hauser explored the challenges that markets have faced so far in this area and commented that he has seen a real change this year. He set out what he considers are the three key ways to build more effective capital markets infrastructure:

• climate disclosure – standard setters need to agree on a single, mandatory framework for companies to disclose risks from climate change;
• climate-linked capital instruments – more tools are needed to provide credible incentives for green investment and more effective transparency for investors on performance against climate goals; and
• climate-focussed asset allocation strategies – a consensus on terminology and approaches is needed to provide a clear and credible choice for clients and investors.