According to a new report by environmental campaign groups WWF and Greenpeace, the amount of CO2 production financed by British asset managers and banks is almost double the annual carbon emissions of the UK.
The report states that the City offered investments and loans for companies and projects that released 805m tonnes of CO2 back in 2019. That accounts to 1.8 times of UK’s annual net emissions for the same year. In 2019, UK’s net emissions amounted to 455m tonnes when discounting shipping and aviation. These are the sectors that are also not included by the UK government in its emissions calculations.
As per John Sauven, UK’s Executive Director at Greenpeace, the United Kingdom could not turn a blind eye towards the City’s contribution to the climate crisis. This is especially before the crucial COP26 climate change conference which will be held in Glasgow in November 2021.
Sauven also added that finance is the dirty little secret of the United Kingdom, given that investors and banks are responsible for more emissions as compared to most nations, and the UK government is providing them a free pass. Sauven further stated that this raises questions over UK’s claim of being world leader on climate action as it permits financial institutions to plough billions into the production of fossil fuels each year.
For the record, the report by WWF and Greenpeace underscores the financial industry as one of the largest contributors of the United Kingdom to the climate crisis. It means that if the City were its own country, it would rank higher than Germany as the ninth largest CO2 emitter at the global level. As per the latest available data, Germany was responsible for around 776m tonnes of carbon emissions in the year 2018.
The analysis was conducted by South Pole, a climate solutions company, and reportedly measured the investment and lending activities of the financial sector of the UK. This was done on the basis of a sample of 10 asset managers and 15 banks.