The government has set out its plans for the UK to be the world’s first net zero aligned financial centre and has called for other countries to follow suit. The government has confirmed it will be introducing compulsory requirements for certain companies to publish net zero transition plans setting out how they will decarbonise by 2050. It has published guidance on what a transition plan is and what will be required, including:
- high-level targets the organisation is using to mitigate climate risk, including greenhouse gas reduction targets;
- interim milestones; and
- actionable steps the organisation plans to take to hit those targets.
The government has also announced that it will be setting up a high-level Transition Plan Taskforce to develop a ‘gold standard’ for transition plans. The Taskforce will report by the end of 2022 and the FCA will also be formally involved in the process.