{"id":93979,"date":"2018-07-17T09:57:07","date_gmt":"2018-07-17T09:57:07","guid":{"rendered":"http:\/\/mostafa.openonline.co.uk\/?guid=488fd4b21b0944bd1ebd34dd1e4fe49b"},"modified":"2018-07-17T09:57:07","modified_gmt":"2018-07-17T09:57:07","slug":"speech-economic-secretary-speech-green-finance-summit","status":"publish","type":"post","link":"https:\/\/mostafa.openonline.co.uk\/?p=93979","title":{"rendered":"Speech: Economic Secretary speech: Green Finance Summit"},"content":{"rendered":"
\n

I\u2019m delighted to address you all this morning for the second annual Green Finance Summit.<\/p>\n

Ladies and gentleman \u2013 no one doubts the strength of the public will to fight climate change.<\/p>\n

In such a time of friction and division, it comforts me to know this cause unifies our country across party political lines\u2026<\/p>\n

\u2026as it continues to stand as one of the greatest challenges of our age.<\/p>\n

How we manage our relationship with our oldest partner \u2013 the natural world \u2013 will be the test of our times.<\/p>\n

As we know, up until recently, government and philanthropy have driven the debate and funded the growth of green finance.<\/p>\n

But there is only so far that this approach can take us\u2026.<\/p>\n

We have witnessed over the past 25 years a deeper \u2013 and genuine \u2013 engagement by the private sector in green finance\u2026<\/p>\n

\u2026through the development of sophisticated financial instruments\u2026<\/p>\n

\u2026and innovations to mobilise green capital.<\/p>\n

All of this has helped propel the UK to the forefront of the global green finance market\u2026<\/p>\n

\u2026with almost $25 billion of green bonds listed in London in seven currencies\u2026<\/p>\n

During my tenure as Economic Secretary to the Treasury, I am determined to push this agenda\u2026<\/p>\n

\u2026for responsible capitalism\u2026<\/p>\n

\u2026and for leveraging market forces to tackle the challenges we face as a collective.<\/p>\n

Today I want to speak to you about three things.<\/p>\n

Firstly \u2013 to take stock of how we arrived at the status quo.<\/p>\n

Secondly \u2013 my vision for the future of green finance \u2013 one that is sustainable, mainstream, and culturally embedded.<\/p>\n

Finally \u2013 how the work of the recently announced Green Finance Institute will be crucial in achieving this vision.<\/p>\n

While I understand that there may be an increased number of political cynics in the room \u2013 which is not necessarily surprising given current events\u2026<\/p>\n

\u2026I want to reassure you that this government\u2019s commitment to stimulating a robust environment for green finance\u2026<\/p>\n

\u2026is not mere political pageantry or a passing fad.<\/p>\n

I am proud that the UK was at the forefront of setting a legislative mandate for combatting this challenge through the 2008 Climate Act.<\/p>\n

But for too long, tackling climate change has been left to government, with the private sector largely left by the wayside\u2026<\/p>\n

\u2026and as a believer in the sanctity of the free market\u2026<\/p>\n

\u2026I am glad to see it taking a long-awaited place at the table\u2026<\/p>\n

\u2026rising to meet the burgeoning appetite of markets and investors\u2026<\/p>\n

\u2026to embrace green finance and responsible investing.<\/p>\n

But green finance has yet to reach its full potential\u2026<\/p>\n

\u2026as I believe it is largely untapped.<\/p>\n

The conversation has been dominated by a few specific areas, such as green bonds.<\/p>\n

And whilst there will always be a place for them, more lies further afield\u2026<\/p>\n

\u2026in the breadth, and depth of global capital markets.<\/p>\n

New instruments are gaining traction.<\/p>\n

Take green loans, now accessible to a greater range of entities, and the emerging green mortgage market.<\/p>\n

And the capacity for green securitisation is enormous.<\/p>\n

It unlocks institutional investor capital to smaller projects that otherwise would be excluded from accessing capital.<\/p>\n

Green funds are emerging from the fray with retail funds in particular becoming more engaged.<\/p>\n

And of course this is being led, as ever, by a growing investor and consumer appetite.<\/p>\n

A recent survey by Eon found 54% of UK consumers would definitely consider taking out a green loan to fund home energy efficiency improvements, with nearly a fifth citing energy efficiency as the most important factor when choosing a property.<\/p>\n

A 2017 survey by Morgan Stanley\u2019s Institute for Sustainable Investing found that 86% of millennials are interested in sustainable investing.<\/p>\n

Such demand will no doubt see an increasing number of asset managers and lenders broadening their offer on green products.<\/p>\n

The figures will speak for themselves: at the end of 2017, only 17% of Europe\u2019s sustainable investment funds were categorised with an environmental focus.<\/p>\n

By the end of this year, we expect this number to have risen substantially, along with increased allocations of investments dedicated to fighting climate change.<\/p>\n

As the needle shifts from fringe to mainstream, from curiosity to permanent action\u2026<\/p>\n

\u2026I think we will continue to see a growth in product offering.<\/p>\n

We may have solved the financing needs of the Paris agreement, but we are not here to discuss this today.<\/p>\n

We are here to discuss how much further we need to go.<\/p>\n

My vision for the next twelve months and beyond is an explosion of the momentum \u2026<\/p>\n

\u2026 to the point where \u2018green finance\u2019 becomes simply \u2013 \u2018finance\u2019.<\/p>\n

We are seeing this happen.<\/p>\n

For example, most of the top European insurers are committed to divesting from coal \u2013 pulling out a staggering USD 20 billion of investment.<\/p>\n

Long-term climate change risks have been pushing pension funds to take action on their investment choices.<\/p>\n

And the global green bond market continues to exceed expectations \u2013 the market is up 78% on 2016 to reach $155 billion of issuances.<\/p>\n

Just yesterday I celebrated the largest green bond listing on the London Stock Exchange, of $1.58 billion, by the Industrial and Commercial Bank of China, the world\u2019s largest bank.<\/p>\n

While green and sustainable equity capital raised at the London Stock Exchange rose at a rate of 197% year-on-year.<\/p>\n

And the Green Finance Taskforce, members of whom I welcome today, published a landmark report in March to help set the trajectory for UK green finance policy.<\/p>\n

I want to quote a line from the report which I think cuts to the nub of the issue:<\/p>\n

\u201cthe sheer scale of capital required dictates that this cannot be driven through either public or private sectors working alone\u2026we need an international alignment of interests, incentives and policies\u201d.<\/p>\n

The momentous challenge facing us all requires a fundamental change of thinking\u2026<\/p>\n

\u2026keep our ambitions limited to short-termism\u2026<\/p>\n

\u2026or seek to hit targets or arbitrary timelines.<\/p>\n

It is incumbent that whilst aiming for tangible results\u2026<\/p>\n

\u2026we support an organic shift in the rationale of the market.<\/p>\n

It is not enough that markets simply react to investor appetites.<\/p>\n

A sustainable and long-term shift in mindset needs to happen\u2026<\/p>\n

\u2026and the market needs to realise green finance is critical for long-term strategies.<\/p>\n

This cultural pivot must happen at an institutional level \u2013 and it is already in train.<\/p>\n

Because there is no doubting that the social impetus to transition to a low-carbon economy is there.<\/p>\n

The whole market must now be brought along in parallel.<\/p>\n

This calls for collaborative action\u2026<\/p>\n

\u2026between governments, between public and private, and between sectors of our economy.<\/p>\n

We have already seen so many successful advancements in this regard\u2026<\/p>\n

\u2026from Barclay\u2019s new green mortgage, offering consumers finance that aligns with their values\u2026<\/p>\n

\u2026 to international central banks forming a network to \u201cgreen\u201d the global financial system.<\/p>\n

Executed well, green finance will not only help achieve our climate targets\u2026<\/p>\n

\u2026but support long term economic resilience\u2026<\/p>\n

\u2026and ensure the continued vitality and relevance of financial services.<\/p>\n

Which is why the Chancellor\u2019s announcement last month of the new Green Finance Institute is so important.<\/p>\n

As he set out at Mansion House, we are working with the City of London to fund a permanent centre to champion green and sustainable finance.<\/p>\n

The Institute will capitalise on the UK\u2019s inherent strength: a magnet for capital and expertise.<\/p>\n

My goal for this new venture is fourfold:<\/p>\n

One – to provide strengthened purpose and branding to UK green finance.<\/p>\n

The Institute will stand as a quality mark, a sign of the UK\u2019s green finance expertise under one unified brand.<\/p>\n

Two \u2013 to demonstrate our international leadership.<\/p>\n

We already lead the world in this market, from attracting over $24 billion in international green bonds, to ensuring we remain partner of choice on green finance for some of the world\u2019s biggest economies.<\/p>\n

Three \u2013 driving innovation<\/p>\n

As I set out earlier, it is not enough to live on the successes of the past\u2026<\/p>\n

\u2026 in order to ensure this market continues to grow, we must keep innovating.<\/p>\n

Building on such strengths as FinTech and local currency finance.<\/p>\n

And finally \u2013 setting the future agenda<\/p>\n

The Institute will be a focal point for government-industry collaboration, working together to open up to new markets and drive forward future policy.<\/p>\n

That\u2019s why this morning I\u2019m delighted to announce the City of London are establishing an Advisory Board to set out the shape and strategy of the Institute\u2026<\/p>\n

\u2026which will be chaired by, Sir Roger Gifford\u2026<\/p>\n

\u2026who brings his extensive experience in green finance to the role.<\/p>\n

Members of the Board will be drawn from our domestic firms, as well as international financial leaders..<\/p>\n

Because it\u2019s not enough for the UK to lead\u2026<\/p>\n

\u2026 we need to make sure we\u2019re taking everyone along with us\u2026<\/p>\n

\u2026as we explore the opportunities this country voted to explore as Global Britain.<\/p>\n

To conclude this morning., I want to share a quote with you:<\/p>\n

\u201cThe\u2026benefit of knowledge obliges you to act ethically. Complacency is not illegal, though it may be equally disastrous\u201d.<\/p>\n

Here was Churchill – speaking of the threats faced by Britain and the world in 1940 by a different kind of enemy.<\/p>\n

From his immortal oratory, I couldn\u2019t help but draw an analogy with the threat we now face.<\/p>\n

We all know too much about what faces us \u2013 and responsibility is the natural corollary.<\/p>\n

I am reassured by the ambition\u2026<\/p>\n

\u2026of government \u2013 as a steward of the environment\u2026<\/p>\n

\u2026and of a body politic \u2013 committed to the climate.<\/p>\n

But it is by reaching for the invisible hand of the market\u2026<\/p>\n

\u2026that green finance can endure\u2026<\/p>\n

\u2026and sustain itself for the benefit of the collective good.<\/p>\n

Thank you very much indeed.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

"My vision for the next twelve months and beyond is an explosion of the momentum to the point where \u2018green finance\u2019 becomes simply \u2013 \u2018finance\u2019." said John Glen.<\/p>\n","protected":false},"author":8,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[13],"tags":[],"_links":{"self":[{"href":"https:\/\/mostafa.openonline.co.uk\/index.php?rest_route=\/wp\/v2\/posts\/93979"}],"collection":[{"href":"https:\/\/mostafa.openonline.co.uk\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mostafa.openonline.co.uk\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mostafa.openonline.co.uk\/index.php?rest_route=\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"https:\/\/mostafa.openonline.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=93979"}],"version-history":[{"count":0,"href":"https:\/\/mostafa.openonline.co.uk\/index.php?rest_route=\/wp\/v2\/posts\/93979\/revisions"}],"wp:attachment":[{"href":"https:\/\/mostafa.openonline.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=93979"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mostafa.openonline.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=93979"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mostafa.openonline.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=93979"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}