CEOs of leading investor groups call on new government to uphold net zero ambition

CEOs of IIGCC, PRI and UKSIF – with backing from a number of UK-based investors and financial institutions – publish open letter to new Prime Minister, Liz Truss, making the case for continued ambition on net zero and climate policy
The letter highlights how continued net zero ambition, including short-term delivery and implementation, can support the Government’s pro-growth and inflation-reducing agenda
The CEOs call for a clear policy vision with near-term actions and milestones so that investors can deliver investment at scale and the shift in capital allocation required to make net zero a reality

The CEOs of three leading institutional investor-focused organisations – the Institutional Investors Group on Climate Change (IIGCC), the Principles for Responsible Investment (PRI) and UK Sustainable Investment and Finance Association (UKSIF) – have published an open letter (available here) to new Prime Minister, Liz Truss, and her government, calling for them to uphold net zero ambition.

Making the case for implementing net zero policies today, the CEOs state the solutions required to address the ongoing energy security and cost of living crises are the same as those needed to achieve the UK’s longer-term climate objectives. As a priority, they call for policies to deliver on energy efficiency, power sector decarbonisation and renewables integration.

The CEOs argue that tackling the climate crisis and avoiding the worst of its impacts are in the UK’s national and economic interest.

Led by IIGCC, PRI and UKSIF, the letter is also supported by eight investors – Aviva plc, Brunel Pensions Partnership, BT Pension Scheme Management, Cardano Investment, Hymans Robertson, Impax Asset Management Group, Federated Hermes Limited and Phoenix Group – with their CEOs and/or senior management adding signatures to the letter in support respectively.

Stephanie Pfeifer, CEO, IIGCC, said: “There are many benefits that support the case for the transition to net zero, including greater energy security and affordability, and an avoidance of the worst impacts of climate change. However, to realise these benefits will require both a significant increase in new investment from the private sector in climate solutions, such as renewables, and a shift in capital allocation to assets that support the transition. To facilitate this, I urge the new Prime Minister to uphold net zero ambition and set a clear policy vision underpinned by near-term actions and milestones.”

David Atkin, CEO, Principles for Responsible Investment, said: “The transition to a net zero economy stands to deliver huge benefits to people and businesses and across the UK, while also helping to deliver the new government’s pro-growth agenda. In the long term, and if approached correctly, the move to net zero will help secure the UK’s clean energy supply for generations, turbocharge economic growth by creating new jobs and business opportunities, and firmly place the UK among world-leading nations on this issue. The UK remains a vital hub for financial services, and we know that our signatories remain committed to doing their part to deliver net zero. We call upon the new UK government to maintain high ambitions on net zero, by supporting these firms in their investment into a net zero future.”

James Alexander, CEO, UKSIF, said: “On behalf of financial services institutions committed to promoting sustainability, we urge the incoming government to reaffirm the UK’s objective to be a global leader in tackling climate change risks. A key part of this will be maintaining ambitious climate policies and building the right regulatory environment to support this. We disagree with the view that UK investors favour a ‘light-touch’ regulatory approach in response to the economic headwinds the country faces.”

“For example, our members require greater clarity on the policy landscape for the real economy and financial services in order to invest more capital towards delivering the clean energy transition whilst enhancing the country’s energy security. This should be encouraged through the creation of clear policy and long-term financing frameworks for various sectors of the UK economy.”

Disclaimer:: This letter was developed in collaboration with a number of IIGCC, PRI and UKSIF members, but does not necessarily represent the views of the entire membership, either individually or collectively.

About IIGCC:

The Institutional Investors Group on Climate Change (IIGCC) is the European membership body for investor collaboration on climate change and the voice of investors taking action for a prosperous, low carbon future. IIGCC has more than 375 members, mainly pension funds and asset managers, across 23 countries, with over €51 trillion in assets under management.

IIGCC works to support and help define the public policies, investment practices and corporate behaviours that address the long-term risks and opportunities associated with climate change. For more information visit www.iigcc.org and @iigccnews

About PRI:

The Principles for Responsible Investment (PRI) is the world’s leading proponent of responsible investment. Supported by the United Nations, it works to understand the investment implications of environmental, social and governance (ESG) factors and to support its international network of investor signatories in incorporating these factors into their investment and ownership decisions. The PRI acts in the long-term interests of its signatories, of the financial markets and economies in which they operate and ultimately of the environment and society as a whole. Launched in New York in 2006, the PRI has grown to more than 4,900 signatories, managing over US$121 trillion.

About UKSIF:

UKSIF is the membership organisation for those in financial services committed to the growth of sustainable and responsible finance in the UK. We look to promote a more sustainable and inclusive financial system that works for the benefit of society, the environment, and us all.

We represent a diverse range of financial services firms committed to these aims, and our 290+ members include investment managers, pension funds, banks, financial advisers, research providers, NGOs, among others, representing over £10trn in assets under management (AUM). More information can be found on our website: uksif.org.