Reacting to today’s Queen’s Speech and the State Opening of Parliament, Nick Molho, Executive Director of the Aldersgate Group, said: “Addressing the energy efficiency of the UK’s built environment and accelerating our transition away from volatile fossil fuels in heating is crucial to support households through the ongoing cost of living crisis. Today’s announcements make some progress in this area, with the welcome intentions to boost consumer protections and trust in new technologies by setting up a market standard and trading scheme for heat pumps, and appointing Ofgem as regulator for heat networks through the new Energy Bill.
Nick Molho added: “However, it is critical to roll out a comprehensive programme for energy efficiency in parallel, as the quickest way to reduce demand for gas and bills in the short term. Boosting energy efficiency holds the potential not only to reduce bills, but also create jobs across the country as part of the government’s “Levelling Up” agenda. With this in mind we welcome the new measures outlined in today’s speech to introduce business models for CCS, transmission and storage infrastructure and hydrogen, which are key in driving down costs and boosting investment in these new low carbon technologies.
Nick Molho concluded: “The establishment of the Future System Operator is also a positive step forward, ensuring better coordination and oversight of future grid transmission development needs, which is a vital part of the effective renewable power system we need to end our reliance on fossil fuels. To build upon this, the role of Ofgem in facilitating net zero delivery must be clarified, with a focus on allowing greater levels of anticipatory investment in transmission infrastructure to build an effective net zero energy system. It is also crucial that introducing competition to the UK’s onshore electricity measures delivers higher investment and cost savings, and does not lead to delivery delays.”
Reacting to the publication of the British Energy Security Strategy, Ana Musat, Head of Policy at Aldersgate Group said: “Accelerating the decarbonisation of the UK's power sector, electrifying more sectors of the economy and driving greater energy efficiency all have an essential role to play in improving the UK's energy security. With this in mind, we welcome the ambition in today’s British Energy Security Strategy to provide 95% of electricity from low carbon sources by 2030, the boosted targets for technologies such as offshore wind and solar power and the increased ambition in low carbon and green hydrogen. The stronger focus on delivery – including on transmission connections for offshore wind projects – is very welcome. However, the Government’s ambitions in low-cost onshore wind could be much bolder and it is disappointing to see so little focus on new regulatory measures and incentives to drive more investment in energy efficiency. Reducing energy demand is an essential part of lowering energy bills for households and businesses and making our economy more resilient to price shocks.”
Ana Musat added: “It is however encouraging to see an emphasis on planning reforms aimed at bringing shovel-ready renewable projects online much faster, by simplifying the process for obtaining transmission grid connections and streamlining the consenting regime. Currently, transmission connections and grid reinforcement projects can take on average between 6-8 years from formulation to consent, with costs between £15- £50m per project . This clearly needs to be reduced to maximise the full potential of the UK’s offshore wind sector and its capacity to deliver clean, cheap power.”
Ana Musat concluded: “Whilst unprecedented short-term energy security concerns mean measures like improving gas storage capacity and optimising production from existing fields in the North Sea are necessary, accelerating the transition to net zero emissions will be the most effective way to improve the UK’s energy security and economic resilience in the medium and long term. It is therefore crucial that the Government’s policy capacity remains focused on this in the years ahead and that the rapid implementation of the Net Zero Strategy is a cross-government priority.”
 Quod Consulting (March 2021) - National Grid: Planning for 40GW by 2030 – how to meet the challenge
Responding to the findings of today’s IPCC Working Group III report on climate mitigation, Nick Molho, Executive Director of the Aldersgate Group said: “Today’s IPCC report is a reminder that despite the ongoing geopolitical crisis, the risks relating to climate change have not gone away and require an urgent response, including a rapid reduction in fossil fuel use. The IPCC’s companion report on adaptation  and the UK’s own climate change risk assessment  made clear the dangers we face now and in the future through further inaction. In response to today’s report, the UK Government should press ahead with its Net Zero Strategy and should use its Energy Security Strategy expected later this week to significantly scale up renewable energy, support more electrification across key sectors and drive energy efficiency across the economy. Reducing reliance on volatile and expensive fossil fuels and accelerating the net zero transition not only makes sense to lower emissions, it also presents an opportunity to boost energy security, drive down energy bills and level up the economy .
Nick Molho added: It is positive to see the report highlight the importance of action in this decade to mitigate the built environment’s carbon emissions. The UK must increase its ambition in this area and take action to drive investment in energy efficiency, and deliver the skills programmes required to make the most of this opportunity in line with the recommendations of the Green Jobs Taskforce. The decarbonisation of heavy industry also features as a priority in the IPCC report. The UK is off to a good start on industrial decarbonisation but must push ahead with policies that make low carbon fuels more widely available to heavy industries, whilst also growing the demand for low carbon industrial products through initiatives such as product standards and a carbon border adjustment mechanism .
Nick Molho concluded: “Despite a challenging context, the international community must present a united front on delivering the ambitious action needed to address the climate crisis. As COP President, the UK Government has a crucial role to play in this process. The UK must ensure that by the start of COP27, nations deliver on promises made in Glasgow to increase emission reduction pledges (INDCs) at COP27, make stronger commitments to phase out fossil fuels, put forward tangible emission reduction plans and actually deliver on the climate finance promised to developing economies. With a world leading climate policy framework and one of the first net zero strategies of any major economy, the UK also has a huge role to play in sharing its policy development and institutional expertise with other nations, and in particular developing economies.”
 IPCC, AR6 Climate Change 2022: Impacts, Adaptation and Vulnerability, February 2022
 UK Government, UK Climate Change Risk Assessment 2022, January 2022
 Aldersgate Group, Net Zero Strategy Policy Tracker, October 2022
 Aldersgate Group, The Missing Link: Establishing Strong UK Supply Chains for Low Carbon Industrial Products, March 2022
Reacting to the United Nations Secretary General's announcement to set up an independent expert panel to review net zero targets, Nick Molho, Executive Director of the Aldersgate Group, said: “At a time when the impacts of climate change are being increasingly felt around the globe and the world economy faces high and unpredictable fossil fuel prices, there has never been a more strategic time for businesses to move to zero or net zero emissions. In the run up to COP26, an increasing number of businesses recognised the commercial and moral imperative of playing their part to tackle climate change and have taken on net zero emissions targets. This is welcome. But it is important that there is a strong baseline and level playing field in place that allows investors, businesses, consumers and the public to independently assess the credibility of different commitments and the progress that individual businesses are making to meet them.”
Nick Molho added: “Ensuring that net zero targets, and the plans to achieve them, are based on scientific, transparent and comparable criteria is not only key to building public and consumer trust, it is also essential to guide investment decisions. An increasing number of investors want to grow their stake in low-carbon technologies, infrastructure and services, and to do so, they need to have a clear and reliable picture of businesses’ climate commitments and how these compare in ambition. So, as an organisation that has always stood for robust targets and disclosure requirements from business, the Aldersgate Group fully supports the UN Secretary General António Guterres’ decision to set up an independent expert panel to provide recommendations on the most credible ways to set and report progress against net zero targets.”
Nick Molho concluded: “To be effective and ensure clarity, the work of the expert group should build on the most credible target setting frameworks that exist already, such as the Science-Based Target Initiative, as a lot of work has already gone into identifying what constitutes robust, science-based criteria. It would also be highly valuable if the Expert Group could provide independent recommendations and guidance on how businesses should develop their net zero transition plans, how they should report on their progress against their targets, and how these requirements can then best be incorporated in domestic and global legislation.”
The Aldersgate Group launches a new report today arguing that the decarbonisation of the UK’s heavy industrial and manufacturing sectors could drive the growth of low carbon industrial supply chains in the UK, increase these sectors’ contribution to the economy, and make UK industry more resilient to global economic shocks and supply chain disruptions.
Based on significant engagement with major businesses across heavy industrial and manufacturing sectors, this report calls on Government to build on its Net Zero and Industrial Decarbonisation Strategies and put in place a comprehensive plan to establish stronger low carbon industrial supply chains. It outlines the measures required to accelerate innovation, grow the demand for low carbon industrial products, incentivise greater resource efficiency, provide a level playing field against high carbon imports, and stimulate investment in skills. The key recommendations are summarised below. 
As of COP26, 136 countries – covering over 90% of global GDP – have committed to achieving net zero.  This presents a significant opportunity for heavy industry and manufacturing to supply the essential materials for net zero infrastructure: from green steel in wind turbines and EVs, glass for solar panels and low carbon concrete in energy efficient buildings.
Establishing strong low carbon industrial supply chains will be pivotal to ensuring that the UK reaps the economic benefits of supplying these components. For example, just one 10MW wind turbine requires £880,000 worth of steel. This presents domestic producers with a significant opportunity if they are able to provide a share of the materials needed to meet the
Government’s target of 40GW of offshore wind capacity by 2030.
Similarly, were the UK to retain and reprocess the lithium and cobalt in its existing EV fleet – which together are worth over £57m  – it could mitigate the environmental and human rights impact of new mining exploration, reap the economic benefits from greater resource efficiency, and become less dependent on imports of precious metals from countries such as China and Russia.
With heavy industry a major employer outside of London and the South East, growing a strong industrial base, fit to supply the building blocks of a net zero economy, will be key to Government’s levelling up agenda. For example, the UK’s regionally dispersed industrial clusters are hubs of economic activity, providing 1.5 million jobs and exporting goods and services worth £320 billion. 
However, high electricity prices, low public investment, and low retention of key materials for remanufacture have led to an increase of imports of industrial products rather than increased demand for domestic low carbon products. This can lead to major delays – as has been seen in the construction sector, where the delivery of key products (such as bricks) is taking as long as 12 months due to supply shortages, affecting the UK’s capacity to build and exacerbating the housing crisis.  Meanwhile, the current gas price crisis and shortages of key raw materials illustrate the impacts of fluctuations in global supplies.
Despite welcome commitments in the Industrial Decarbonisation and Net Zero Strategies, a comprehensive plan from government, including targeted and more accessible investment to support fuel switching and large-scale deployment of key technologies is needed to create a business environment conducive to investment in low carbon production.
Backed by extensive engagement with representatives from heavy industry and manufacturing such as the steel, cement, glass, construction and automotive sectors, today’s publication makes recommendations to establish a robust industrial and manufacturing base in the UK that is able to take advantage of growing demand for low carbon products, and mitigate key dependencies on other countries for critical materials and components vital to the UK’s economy.
Nick Molho, Executive Director of the Aldersgate Group, said: “UK heavy industrial sectors already employ more than 2.6 million people and contribute £170bn each year  to the UK economy. The net zero transition provides an opportunity to grow this contribution even further by increasing investment in domestic supply chains to support these sectors as they decarbonise. For this to materialise, the Government must put in place a comprehensive set of measures that grows the demand for low carbon industrial products, accelerates innovation in key technologies such as CCS and low carbon hydrogen, makes the price of electricity more competitive and provides a level playing field against high carbon imports whilst maximising opportunities to export low carbon industrial products.”
Key recommendations for government include:
Alan Tinline, Group Head of Health, Safety and Environment at Associated British Ports, said: “It has never been more apparent that the UK must transition urgently towards low carbon industrial supply chains. This will require a more efficient use of energy, widespread modal shifts, and expansion in low carbon energy production to power a resource-efficient economy through innovation and upskilling. ABP is working at pace in all these areas to support and facilitate rapid decarbonisation in the supply chain. This policy briefing from the Aldersgate Group highlights a number of key areas that will accelerate decarbonisation in the supply chain, with actions that could be undertaken in short order.”
Adam Whitmore, Principal Policy Adviser at Bellona, said: “Achieving net zero presents tremendous opportunities for UK industry and the wider UK economy. This report provides a welcome range of practical recommendations for how these opportunities can be realised, from developing innovation and skills to creating demand for low carbon products and enhancing competitiveness. It is an important contribution to the policy debates.”
Fiacre O’Donnell, Director of Sustainability at Encirc, said: “Establishing a low carbon industrial sector offers a number of significant opportunities to the UK, from emissions reductions and resource efficiency, to job creation, exports, and expansion into rapidly growing markets for low carbon goods. We welcome this Aldersgate Group briefing and the recommendations it makes to government, who must support the growth of competitive low carbon industrial supply chains to ensure the UK stands ready to harness these opportunities as we approach net zero.”
Danial Sturge, Carbon Policy Practice Manager at the Energy Systems Catapult, said: “Industry sits at the heart of innovation, which is not only important for the UK’s Net Zero ambitions, but provides an opportunity to lead the world in creating a market for low carbon manufacturing and products, supported by robust carbon accounting and standards. The Aldersgate Group’s recommendations lay out the near-term steps needed to reach our long-term climate goals.”
Roz Bulleid, Deputy Policy Director at Green Alliance, said: “Forward thinking companies and consumers are already asking for greener raw materials and components – recycled steel, lower carbon cement, more efficient glass – UK industries need to adapt or see their markets wither away. But adaptation isn’t easy when you’re talking about large, capital intensive plants with long lifecycles. That’s why, as this report sets out, the government needs to step in, bridging the gap to a greener industrial future with a suite of policy measures that can level up the playing field for early movers and give long term confidence to those looking to invest in lower carbon processes and products.”
Sam French, Business Development Director at Johnson Matthey, said: “The UK’s transition to net zero is urgently needed for both the climate and economy. It also gives industrial producers and manufacturers the opportunity to benefit from growing demand for low carbon products. This report outlines the steps needed to drive innovation towards low carbon production, and the measures that will ensure the UK can provide vital industrial goods and services at a time when the world is facing increasing political and economic instability.”
Ed Heath-Whyte, Head of Environment and Sustainability at Liberty Steel, said: “As the drive towards net zero intensifies, low-carbon products present significant opportunities to reduce energy consumption, cut waste, and increase reuse. The role of demand-side policies from UK Government in addressing product standards, public procurement, carbon leakage mitigation amongst others will be crucial to encouraging this market growth. The recommendations from the Aldersgate Group report provide important thinking on the policy environment needed to support industrial competitiveness and to develop relevant supply chains.”
Chris McDonald, Chief Executive Officer at the Materials Processing Institute, said: “Industrial products are vital for our security and economic prosperity, they are also the basis on which the green economy can be realised. Our industrial supply chains are key employers throughout the UK, but are at risk from high energy prices and offshoring. As we look to green our economy and increase resilience, the recommendations in this report from Aldersgate Group, will ensure that the UK captures the opportunities of Net Zero, creates jobs and protects our vital sovereign capability.”
John Howe, Managing Director of Michelin UK, said: “Re-treaded truck tyres can be a significant contributor to resource efficiency and decarbonisation. We welcome this Aldersgate Group paper and we would echo the calls for government to do all it can to retain valuable secondary materials for remanufacturing in the UK.”
Philippa Spence, Managing Director at Ramboll UK said: “As the world continues with its transition to a net zero economy, the need for low carbon industrial products will grow exponentially. This means growth, jobs and exports not only for the UK’s heavy industries but all along the value chain, in areas like the construction and automotive sectors. We welcome this new report from the Aldersgate Group, which puts forward tangible solutions to enable the UK to fully harness these opportunities, while accelerating the pace and cost efficiency of industrial decarbonisation.”
Kate Turner, Regulation and Policy Director at ScottishPower Renewables, said: “Doubling down on decarbonisation will create a secure, clean, green and fairer economy and going faster and harder on net zero is critical if we’re to retain the UK’s competitive advantage in renewables and support long-term energy security. Across ScottishPower we’re investing £10bn to accelerate low carbon infrastructure, creating green jobs and huge opportunities to establish a sustainable UK supply chain that can compete globally for decades to come. We need to seize this moment, the recommendations in this report can help to unlock clean, cheap and secure power generated at home and provide the framework for green growth.”
Olivia Whitlam, Head of Sustainability at Siemens, said: “Taking a thorough approach to creating a low carbon market in all tiers of the supply chain not only supports decarbonisation of the economy, but has the potential to deliver significant economic benefits, driving resource efficiency and security to ensure the UK can thrive. We welcome the recommendations of this Aldersgate Group report, which lay out a clear framework for government to accelerate strong supply chains while harnessing these benefits of the transition to net zero.”
John Scanlon, Chief Executive Officer for SUEZ recycling and recovery UK said: “Improved resource efficiency is critical to decarbonising the UK’s heavy industries and manufacturing sectors, and the recycling and resource management sector has an important role to play in this. Whether it is working on solutions to re-use material that others throw away, recycling wind turbine blades or supplying the cement industry with a fossil fuel alternative, at SUEZ we are already playing our part. However, there is much more to do for the UK to meet the net zero challenge. I therefore welcome the recommendations in this Aldersgate Group paper, that set out tangible steps to improve performance throughout the supply chain.”
Julia Barrett, Chief Sustainability Officer at Willmott Dixon, said: “We warmly welcome the Aldersgate Group’s new briefing on low carbon industrial supply chains. The built environment consumes almost half of the materials extracted globally every year, and as this report highlights, we need a systematic rethink to drive the supply of low carbon products and investment in skills and resource efficiency. There is an opportunity for Government to accelerate the transition through its own procurement, and by joint departmental working to eliminate the unintended consequences of siloed policy development.
- FOOTNOTES -
Our previous reports on industrial decarbonisation include Accelerating the Decarbonisation of Industrial Clusters and Dispersed Sites – which provides a comprehensive policy framework for the quick and cost-effective decarbonisation of heavy industry – and Delivering Competitive Industrial Electricity Prices in an Era of Transition – which provides a series of measures that government can take to reduce the cost of electricity for industrial users.
 The Aldersgate Group’s new report, The Missing Link: Establish a strong UK supply chain for low carbon industrial products, is available to download from the button on the right.
 This publication will be discussed at a public webinar from 9.30am to 11.15am on March 17 with panellists from key industry organisations and the lead author of the report. You can register here.
 Energy and Climate Intelligence Unit, Data-Driven Enviro Lab, New Climate Institute, Oxford Net Zero (2021) Net Zero Tracker [accessed 03/03/2022]
 Green Alliance (November 2021) Critical Point: Securing the raw materials needed for the UK’s green transition p.15
 HM Government (September 2017) Industrial Clusters in England
 Federation of Master Builders (20 April, 2018) Material Prices Continue to Rocket, Says FMB [accessed 03/03/2022]
 BEIS (March 2021) Industrial Decarbonisation Strategy p.16
Reacting to the upcoming publication of the UK Government's Levelling Up White Paper, Nick Molho, Executive Director at the Aldersgate Group, said: “The Government’s 12 missions to level up the UK set a welcome ambition to spread economic opportunities, high quality education and a good quality of life across the country. A rapid transition to a net zero emissions economy is going to be absolutely essential to deliver these goals in practice. Growing investment in renewable energy , building insulation , electric vehicles , public transport and low carbon industrial clusters  hold the key to creating jobs, improving productivity, driving private investment and skilling up the workforce across the country. If the Government is serious about its Levelling Up ambitions, it must proceed at pace with the implementation of its Net Zero Strategy .”
 It is estimated that the offshore wind sector will see jobs increasing from 26,000 currently to 70,000 by 2026, with jobs created in areas such as the Solent, the Humber and Scotland - Offshore Wind Industry Council [OWIC] (2021), Offshore Wind Skills Intelligence Model Report
 According to the Construction Industry Training Board (CITB), improving the building fabric energy efficiency of every building in the country in need of retrofit will require 12,000 workers to be trained every year for about the next four years, before the need to ramp up annual recruitment by up to 30,000 workers between years 2025 and 2030. This implies an increased trained workforce of up to 230,000 by the end of the decade - Construction Industry Training Board [CITB] (2021), Building skills for net zero
 It is estimated that the UK could produce around 1.6 million EVs per year by 2040 and establish seven gigafactories in national territory. These gigafactories could create up to 78,000 new jobs (both direct and in the supply chain), with 24,500 in battery manufacturing, 43,500 in the battery supply chain, and around 10,000 in EV manufacturing – Faraday report – March 2020 update. Annual gigafactory study: UK electric vehicle and battery production potential to 2040
 Low carbon industrial clusters that could support the productions of low carbon industrial products such as steel, glass and chemicals could be developed in a wide range of locations such as South Wales, Merseyside, Teesside, the Humber and the Southampton area - Aldersgate Group (2021), Accelerating the Decarbonisation of Industrial Clusters and Dispersed Sites
 Aldersgate Group (2021), Net Zero Strategy Policy Tracker: Key Announcements and Next Steps
Reacting to the UK Government's £31m floating offshore wind innovation funding announcement, Nick Molho, Executive Director at the Aldersgate Group, said: “Following on from the significant amount of offshore wind projects selected at the ScotWind Leasing round last week , today’s announcement is a reminder of how long-term targets and stable policy support can accelerate innovation across the renewables industry. Building on the jobs already created by the offshore wind sector in areas such as Hull, the Solent and Scotland, the geographic spread of the projects receiving innovation funding today highlights that the renewables sector – and low carbon industries more broadly – can drive investment and job creation in multiple parts of the country and be a key part of the levelling up agenda.”
 Crown Estate Scotland, ScotWind offshore wind leasing delivers major boost to Scotland’s net zero aspirations
Responding to the publication of the UK’s Third Climate Change Risk Assessment, Signe Norberg, Head of Public Affairs and Communications at the Aldersgate Group, said: “The publication of the UK’s third climate change risk assessment is a clear reminder that unmitigated climate change comes with significant costs to the UK economy. The report rightly emphasises the need for urgent and co-ordinated action to both reduce emissions and adapt the UK’s economy and infrastructure to the levels of climate change we are already locked into. In practice, this means that the Government’s work on implementing the Net Zero Strategy, enacting long-term nature improvement targets under the Environment Act, and creating the next National Adaptation Plan all need to be carried out at pace and in a joined-up way.
Investing in a healthier natural environment is key to making the UK more resilient to the impacts of climate change and it will be critical that the Government puts forward ambitious and credible targets under the Environment Act as well as a new and comprehensive Environmental Improvement Plan later this year. The UK must also continue its efforts to deliver rapid emission reductions across the economy and beyond just the power sector. As set out in the Aldersgate Group’s Net Zero Strategy Policy Tracker, key policy gaps remain in crucial areas, such as energy efficiency, agriculture and land use, and skills. 
The Government is right to want to increase awareness of climate risk at the local level in future assessments but this ambition must be paired with further financial and policy support for local authorities, so they can play a significant role in tackling climate change.”
 The Aldersgate Group published its assessment of the UK’s Net Zero Strategy in October 2021. Click here to download the briefing.
Reacting to the publication of the Climate Change Committee’s report on the key outcomes and next steps from COP26, Nick Molho, Executive Director at the Aldersgate Group, said: “The Committee on Climate Change is right to argue that the best way for the UK to honour the Glasgow Climate Pact is to crack on with developing the policies and tax reforms needed to achieve its NDC and net zero target. The UK has set an ambitious national emission reduction pledge and comprehensive net zero strategy but the business community now needs to see more detailed policy measures being implemented in areas such as buildings, power, heavy industrial decarbonisation and land use to put the UK on a credible and timely pathway to meet its NDC and net zero target.  Implementing the UK’s Net Zero Strategy in earnest must now become a cross-government priority.”
Nick Molho added: “With the UK holding the COP Presidency for another year, it is also vital that the UK continues working with world leaders to significantly increase national emission reduction pledges in 2022 in line with a 1.5 degrees pathway, by providing clearer commitments on full coal phase out and end of fossil fuel subsidies and reaching a solution to deliver the minimum $100bn of climate finance pledged to developing countries.” 
 The Aldersgate Group published its assessment of the UK’s Net Zero Strategy in October 2021: https://www.aldersgategroup.org.uk/asset/2019
 On 13 November 2021 the Aldersgate Group issued a reactive press release responding to the outcomes of COP26 – calling on world leaders to accelerate momentum on climate action: https://www.aldersgategroup.org.uk/latest#cop26-moves-the-dial-towards-1-5c-but-momentum-must-increase-in-2022
Following the conclusion of the COP26 climate summit, the Aldersgate Group welcomes the important pledges made over the last two weeks in areas such as deforestation, methane, finance and innovation, the progress made on agreeing rules for international carbon markets, the clear next steps that have been identified in the Glasgow Climate Pact for all countries to increase their emission reduction pledges in 2022, and the commitment for countries to move away from the use of unabated coal and fossil fuel subsidies.
Recognising that much remains to be done to put the world economy on track for 1.5C, the Group calls on world leaders to accelerate momentum, by significantly increasing national emission reduction pledges in 2022, updating low carbon development plans, providing clearer commitments on full coal phase out and end of fossil fuel subsidies, and reaching a solution to deliver the minimum $100bn of climate finance pledged to developing countries.
The UK Government – which deserves praise for its efforts during the negotiations and which will retain the COP Presidency for another 12 months – must continue to drive progress in these critical areas of climate negotiations, whilst at the same time developing the policies needed to accelerate the UK economy’s own transition to net zero emissions.
The COP26 summit saw an unprecedented degree of business support for achieving a rapid shift to net zero emissions, with a growing number of sectors and businesses taking on new climate targets and some of the world’s largest financial institutions committing to align their investment portfolios with the 1.5C target under the Paris Agreement .
The summit also delivered some important pledges, with China and the United States agreeing close collaboration on climate action  and over 100 countries agreeing to end deforestation by 2030  and cut methane emissions by 30% by 2030 . Critically, the Glasgow Breakthroughs – which are supported by over 40 countries and aim to accelerate cost reductions and market deployment in renewable power, clean transport, hydrogen, green steel and sustainable agriculture – could have a significant impact on driving global private investment towards low carbon technologies .
The formal negotiations have delivered progress in some areas, most notably by introducing a requirement for all countries to submit more ambitious emission reduction pledges in 2022 to keep the 1.5C target alive, explicitly acknowledging for the first time the importance of national economies moving away from their dependence on fossil fuels and progressing rules on international carbon trading, despite some concerns remaining on the risk of double counting of credits. The Glasgow Climate Pact is also clear that developing economies urgently need to deliver the $100bn of annual climate finance pledged to developing economies and that this level of financial support will need to be increased.
However, whilst it has shifted the dial forward, the COP26 summit does not at this stage put the world on track for 1.5C, with many actions required in 2022 to close the emissions gap. Progress is urgently needed in areas such as the delivery of climate finance for developing countries, increasing investment in nature restoration and climate adaptation, the development of more ambitious national emission reduction pledges and low carbon strategies, and on a clear pathway to move away from fossil fuels, including a full phase-out from coal.
Rt Hon Theresa May MP, Chair of the Aldersgate Group, said: “Despite many challenges, COP26 has delivered important progress, both in terms of the negotiations themselves but also through the meaningful pledges that governments, businesses and financial institutions have made over the summit. But we must recognise that much work remains to be done to put the world on track for the 1.5C target. Time is of the essence. Governments across the world must continue to work together to close the remaining gaps in ambition and with its Presidency of COP over the next 12 months, the UK Government has a vital role to play.”
Nick Molho, Executive Director of the Aldersgate Group said: “The business community – including many British businesses - turned up in force at COP26 and made clear its support for the 1.5C target and its intention to deliver a thriving, net zero emissions economy on the ground. Beyond its vital role on the global stage, the UK Government should build on this momentum by implementing its net zero strategy and driving much needed business investment in low carbon power, buildings, transport, industry and agriculture.”
Henrik Pedersen, CEO, ABP, said: “ABP welcomes the progress that has been made at COP26 in Glasgow. It is now essential that governments around the world - including here in the UK - maintain this momentum and accelerate the pace of policy development in the months ahead. The Clydebank Declaration on Green Shipping Corridors is a positive example of the collaboration between nations that will be required to drive decarbonisation in maritime and global trade. Around the world, maritime ports have a critical role to play in facilitating the decarbonisation of transport, industry and energy generation. In the UK, ABP’s ports stand ready to play their part in delivering these shared objectives.”
Peter Simpson, Chief Executive, Anglian Water and Co-Chair of the Corporate Leaders Group, said: “Since Paris the world has changed, in the severity of climate impacts we’ve seen but also in how loudly progressive businesses and society want governments to step up. It was obvious during my time in Glasgow that private enterprise is already deeply engaged in transformative climate action, and a wealth of green finance is there to be exploited. The water industry’s sector-wide commitment to net zero by 2030, 20 years ahead of the UK’s legally-binding target, is just one example of businesses leading the way. But we need governments to go further and faster more urgently, given what’s at stake.”
Sue Riddlestone OBE, CEO & Co-founder, Bioregional, said: “Buildings are responsible for 40% of our carbon emissions, so it was significant to see more governments than ever before committing to cut emissions from the built environment in their Nationally Determined Contributions. And the fact that two-thirds of financial institutions have signed up to the Glasgow Financial Alliance for Net Zero will no doubt help much needed capital investment flow into sustainable buildings.
With COP drawing to a close, it is now crucial that we get on with delivery - working with Government to create a viable plan for the energy efficient retrofit of our homes, and to ensure that only net-zero carbon buildings are developed in the future.”
Gabrielle Ginér, Head of Environmental Sustainability, BT, said: “Despite COP26 coming to an end, the need for urgent climate action continues. While we welcome the launch of the Declaration on zero emission cars and vans which signals that we are turning a corner on road transport emissions, we need Governments and businesses across the world to do more. It’s time to commit to net zero, align to 1.5 degree Celsius science-based targets and set out clear and transparent implementation plans.”
Iain Patton, CEO, EAUC said: “It is exciting and a relief to see 1050 universities and colleges across the world committing to net-zero through the Race to Zero campaign of which EAUC is the global Secretariat. We also welcomed the draft strategy on sustainability and climate change from the Department of Education to support all education providers to be net-zero, to improve biodiversity and to obtain clear data on GHG emissions.
“We are delighted that Education Ministers from around the world were finally invited to COP26, but we still have much more to do. We need ALL universities and colleges around the world to commit to net-zero targets, and we need to get our own house in order to fully integrate climate education in the curriculum in the UK – it is clearly just not good enough to have a few hours in Geography or Science.
“Students and other young people are looking at us for leadership and we need to take bold steps to provide the skills and knowledge that young people will need to thrive. To quote the Italian Education Minister, Patrizio Bianchi, “everything starts with education and every career is a sustainable career".
Ece Ozdemiroglu, Founder, eftec: “From official negotiations to side events with NGOs, sector organisations, and investment managers, from the Blue Zone, and to the streets of Glasgow on the Global Day of Climate Justice march, COP26 was an exhilarating experience for me. If I had a word cloud for the event, ‘Climate Justice’ and ‘Just Transition’ would be the biggest phrases, both internationally and here in the UK.
The statements from the Heads of States are still not enough, but they are encouraging. We must and will continue to bring mitigation and adaptation closer, to help design the most useful role for the public sector, to provide evidence to mobilise more investment in nature, and to encourage everyone to see adaptation as an opportunity to create a healthier and happier society.”
Tim Anderson, Group Head of Transport, Energy Saving Trust, said: “Transport is the single biggest contributor to carbon emissions in the UK and accounts for around a quarter of all global emissions. We need strong policy commitments, practical support and incentives in place at national and international levels to decarbonise transport. We are motivated by the outcomes of COP26 including commitments to electrification, active travel incentives, as well as innovation to support the decarbonisation of rail, marine and aviation. There is significant work to be done to turn this ambition into action.”
Sarah Mukherjee MBE, CEO, IEMA, said: “Whilst I’ve been at COP I have witnessed some great discussions and campaigning for a good outcome to keep temperature rises below 1.5 degrees, but I and our IEMA members are worried that the outcomes of the negotiations won’t go far enough without more concrete plans from countries that are responsible for the highest levels of emissions.
There is an onus on those countries that have locked in ambitious emissions targets to continue to persuade those that have not done so to do likewise and therefore demonstrate real climate leadership, alongside a willingness to collaborate on solving this greatest of challenges. We must also continue to equip more people and organisations internationally with the right green skills to guide and lead real change for a sustainable future.”
Peter Jelkeby, Country Retail Manager and CSO, IKEA UK & Ireland, said: “COP26 was an historic opportunity to recommit the world to a 1.5 degree future, and as we emerge from the summit, at IKEA we’re clear that this remains the only way to deliver a more sustainable future. While we welcome the significant announcements made across COP26, governments and our leaders must now listen to the voices of the many people that were raised throughout the summit, including many thousands of inspirational young people to whom we must listen, learn from, and engage with. The UK Government must also recognise the demands for action from businesses and across society, and make good on their commitments and deliver the detailed pathways and policies we need to assemble a better and more sustainable future.”
Professor Martin Siegert, Co-Director of the Grantham Institute – Climate Change and the Environment, Imperial College London, said: “My feeling is that it's been good to hear about the initiatives discussed and launched at COP26 but too early to yet say whether they will be meaningful or successful. Though I'm sceptical about some statements and pledges, ultimately the most important figure is the atmospheric CO2 concentration, and we'll only know whether COP26 has shifted that number in some years’ time. Looking back at the CO2 record from 2015 and afterwards it doesn't look like COP21 had much impact (yet), so while I welcome all the initiatives it may be that we'll need to substantially ramp up deliverable global actions if, in a few years, it turns out that COP26 has not led to in a noticeable shift in the CO2 level.”
Jon Khoo, Head of Sustainability (EAAA), Interface, said: “At COP26 we have discussed the urgency, now it is time to demonstrate agency. The business community is aware of the scale of the challenge we face with the climate crisis, and must now demonstrate its ingenuity, determination and willingness to act. Equally, we must ensure we’re listening to the youth activists, the scientists, and the diverse voices we have heard from at Glasgow. For a pledge is a promise, reducing GHG emissions will be a fact.
It was pleasing to see the built environment and construction take an important role on the penultimate day of COP26 as our industry is connected with up to 40% of global carbon emissions. With this in mind, tackling both operational and embodied carbon emissions must remain a key focus for every nation’s journey to net zero. Finally, we were encouraged by the progress of Race to Zero campaign and increased use of Science-Based Targets as basis for credible action by businesses.”
Simon Winch, Sustainability & Ethics Lead on Environment, John Lewis Partnership, said: “COP26 has been a vital opportunity for world leaders to come together to discuss how we accelerate action towards the goals set out by the Paris Agreement and UN Framework Convention on Climate Change. We are absolutely committed to that ambition and recognise the important role the retail industry has in supporting its goals. This is why we are working hard to establish our science-based targets in line with the 1.5°C pathway, which will build on our existing 2035 net zero commitments. We won't solve the climate crisis alone or overnight but we recognise that the time for talking is over and we are prepared to take bold action to ensure we're part of the solution."
Caroline Laurie, Director of Responsible Business, Kingfisher, said: “Now is the time for us all to take action and we know we all have more to do however, COP26 has delivered important progress through the pledges, initiatives and negotiation progress that has been achieved. Continued momentum is essential to put the world economy on track for 1.5C, both in terms of global negotiations, and in terms of national climate policy.
From a UK business perspective, one of the most impactful steps we have seen come out of COP is the requirement for listed companies to publish net zero transition plans that align with the UK’s net zero target. This will not only help accelerate actions to decarbonise the economy but will also address concerns over greenwashing. However, the commitment could be made stronger by broadening its application to all large companies.”
Simon Virley, Vice Chair and Head of Energy and Natural Resource, KPMG UK, said: “While the debate has already begun about whether COP26 has been a success or a failure, the truth is it’s somewhere in between. Progress was made in a number of areas: initiatives like GFANZ that has mobilised $130 trillion of ‘net zero’ global capital and the ‘Glasgow Breakthroughs’ on clean tech are welcome, as are the agreements on reforestation, cutting methane, phasing out coal and the take-up of EVs. But, even with these measures, the world is definitely not on track to limit global warming to 1.5 degrees.
“One very big and welcome shift has been the much greater involvement of the business and finance community at COP26. In Glasgow there was evidence of more of a ‘bottom-up’ approach, with businesses taking the initiative on developing plans for Net Zero and not waiting for governments to act. COP26 is best viewed not in isolation but as part of an ongoing, global process of negotiations and initiatives to reduce climate change, one that continues next year at COP27.”
Nigel Wilson, Group CEO, Legal & General, said: “In the two weeks of COP26 the world is ever more convinced of the imperative on action and delivery. Debate is not enough. The challenges and deliverables agreed in Glasgow on how we tackle climate reflects that this is not only the most urgent issue but also the biggest investment opportunity of our lifetimes. We can harness the power of business and markets to make sure that the transition happens. That is why our roadmap to net zero focuses on funding the transition to support a low carbon future and deliver secure returns. That is why we are investing in renewable energy, and we have actionable climate plans in place across our major business areas including investments, housing and commercial property.”
Daniel Johns, Chair of the National Flood Forum and Director at the Aldersgate Group: “COP26 has focussed attention on critical areas of climate action like never before. Adaptation, nature and water have finally had the focus they deserve. Yet despite that welcome shift, we are still not where we need to be in the races to net zero and resilience, especially in preparing for flooding, sea level rise and increasing water scarcity. If anything, COP26 has highlighted just how far governments are now lagging behind where businesses and the public want them to be in preparing the country for climate change.”
Duncan Burt, Chief Sustainability Officer at National Grid, said: “COP26 has set us on a trajectory where we can conquer climate change but we are just at the beginning of a vast effort to deliver and exceed the promises that we have made. There remains much still to do but Glasgow’s COP26 has moved us firmly forward, bringing us with the margin of error of 2C warming. Many of the major building blocks of a climate friendly future are understood and now simply need to be built: zero carbon electricity supply, electric vehicles and charging infrastructure are all underway in the US, UK and around the world. But more needs to be done to demonstrate that richer nations will play their part on leading the global transition: richer nations should go faster and ensure the financial commitments to support the global transition are met.
We are working to deliver zero carbon energy for our communities and to help accelerate the transition. We are working globally to enable the wider transition through initiatives such as GGI-OSOWOG. We must now move at speed to seize the opportunity to limit warming below 2C and keep 1.5C in sight.”
Greg Jackson, Founder and CEO, Octopus Energy Group, said: "COP26 was a great chance for business leaders, governments and activists around the world to come together to work towards a green, clean future, and Octopus Energy are delighted to have used its galvanizing influence to announce a flurry of agreements to bring our technology and wind turbines to even more countries, turbocharging the green energy revolution around the world. But, before we all pat ourselves on the back, COP26 also shed light on the fact that we still have a long way to go.
Octopus Energy recently secured funding from Al Gore founded Generation Investment Management and we'll continue to use it as fuel for our global green mission. But please, we ask of you all - we have the tools to make green energy the cheapest energy for everyone, let's not waste any more time in weaning ourselves off dirty fossil fuels for good."
Gavin Templeton, Partner, Pollination, said: “It remains to be seen whether COP26 will be judged as a success or a missed opportunity but the stark warnings from the IPCC climate change report appear to have shifted momentum in the debate. Decisive action has been taken on halting deforestation, cutting methane emissions and the phasing out of coal-fuelled power plants and India’s engagement with the net zero target must surely be viewed as a diplomatic win. It is clear the transition to a low-carbon economy will require a reframing of the global economy, radical thinking, and breakthrough ideas so it is fitting that natural capital finally took centre stage and $130trillion of private capital has been directed to decarbonisation. GFANZ has laid down the gauntlet to policy makers and public sector financiers so will they step up to the plate? The time for talking is over and we now need concrete measures to accelerate the transition towards net zero.”
Philippa Spence, Managing Director, Ramboll UK, said: "COP26 has delivered progress but fallen short on securing our 1.5-degree future. I urge businesses and authorities to prioritise adaptation and resilience measures, whilst accelerating the pace of decarbonisation. The solutions to do so exist here and now, but must be strengthened with changed leadership behaviours and the willingness to adopt low-carbon business models. The private sector can lead the green transition, but it will take bravery. We must be open to leaving the tried-and-tested behind, and acknowledge that some of the challenges are not as hard we think!”
Keith Anderson, CEO, ScottishPower, said: “It’s fair to say that Glasgow has never experienced anything quite like COP – it has energised civic society and brought commitments from business ranging from the car manufacturers to the finance sector to take action to address the climate emergency.
“From our headquarters in Glasgow, at ScottishPower we’re proud to be playing our part in the green transformation. Speeding up the journey to a greener future is at the heart of everything we do. We were the first large energy company in the UK to generate the 100% Green electricity - closing our coal plants, ditching gas, and focusing entirely on green generation and investing in the grid to bring on even more renewables. All of our investments – £10 billion in the next 4 years – are determined through the prism of Net Zero.
“What we’ve seen over the past two weeks are the building blocks being laid for the Net Zero transition, with enduring commitments on coal, methane, forestry and transport. On their own they may not be enough, but together they begin to build momentum. My expectation is that COP26 will prove to be the springboard for faster action and greater ambition. Reflecting on a momentous fortnight, what really brought home the significance of COP to me was seeing the thousands of people – of all ages, backgrounds and nationalities – coming together to march for change last weekend. Coming past our building, which is decked out in the global warming stripes along its base, it was clear to me that the message really was very simple: do more, do it now, do it faster, do it for them.”
Carl Ennis, Chief Executive Officer, Siemens plc, said: “Measure of the success of the COP negotiations must be more nuanced than simply the ultimate target. Net zero, with net benefits, is a journey, and whilst the discussions in Glasgow may not have detailed all the steps required, I believe that we should focus our efforts on delivering what we can do right here, right now. Business is ready to play its part.”
Meg Baker, Director of Education, SOS-UK, said: “We welcome the progress being made to connect the climate crisis with the role of education as a key enabler for change. At COP26 we saw the first ever convening of Education and Environment Ministers as part of the presidency programme which is a positive step in the right direction. From this a number of nations have made meaningful commitments to embed climate and sustainability into education policy, including the UK Department for Education who used the event to launch their draft Climate and Sustainability strategy. The strategy includes a strong focus on training and skills as well as integration into STEM subjects which are all absolutely crucial, for an even more ambitious strategy we are calling for this to cover all subject areas to break the current silos we are seeing in education.”
John Scanlon, Chief Executive Officer, SUEZ recycling and recover UK, said: “Although frustrated by the absence of waste and resources on the agenda at COP26 before the conference began, two weeks on I am more upbeat – it was there, time and again, woven through and embedded in speeches by high profile figures from across the globe, indicating the pivotal role resource efficiency plays in meeting our emission reduction pledges. With the Environment Act passing into law this week, the path is clear for the reforms needed to transform our take, make and dispose culture to a more circular economy and we stand ready to work with our partners across the value chain to make resource efficiency a reality.”
Giles Bolton, Responsible Sourcing Director, Tesco, said: “We are encouraged by a number of the agreements secured at COP26, notably in areas such as eliminating deforestation and reducing potent methane levels by 30%, both by 2030. We look forward to supporting the implementation of these initiatives. Delivering low carbon economies and net zero commitments requires everyone to play their part, facilitated by targeted investment. Earlier this year we announced our own commitment of achieving net zero across our entire value chain by 2050, in line with a 1.5C trajectory. We welcome the announcement of the Glasgow Financial Alliance for Net Zero to deliver more than $130 trillion in financing to transition global economies by 2050.
We hope COP26 will lead to continued ambitious action, both from governments and businesses and that the UK will accelerate its transition to net zero emissions. We have no more time to waste in this important decade of action.”
Maria Connolly, Partner and Head of Clean Energy, TLT LLP, said: “Collaboration will continue to be key even after COP26 is over, but it’s extremely encouraging to have seen so many organisations coming together over the last couple of weeks to make global pledges. In particular, the launch of The Adaptation Research Alliance was a hugely positive step towards creating affordable low carbon technologies. However, it was slightly discouraging to see only a small number of countries signing up to the policy declaration on the transition to zero emission vehicles, with some of the world’s largest auto markets staying on the side-line. Currently private sector investment is driving the change in this market and we’re seeing creative new joint-ventures and deals come about to deliver record numbers of EV charging stations. While there’s still much to be done, we can be encouraged that the progress made over the last week or so will surely go some way in helping all nations reach their net zero goals.”
Bevis Watts, CEO, Triodos Bank UK, said: “Triodos Bank welcomes the inclusion of dedicated discussion on the role of finance in the COP26 programme, and the creation of the Glasgow Financial Alliance for Net Zero (GFANZ). Having called repeatedly for net zero transition plans to be made mandatory, we see the announcement that UK financial institutions will be required to produce such plans on a ‘comply or explain’ basis as a step in the right direction. It is critical that the standards developed for such plans are robust, science-based and aligned to 1.5-degree scenarios.
However, more action is needed. We call for an end to investment in fossil fuel expansion and exploration, for robust carbon pricing that truly reflects its social and environmental cost and for fossil fuel subsidies to be systematically dismantled. And we ask that the financial sector be regulated not only in line with the potential risks and opportunities that arise from climate change, but also with recognition of its role in the causes of this crisis. If we want a net zero society and economy, we need to regulate for a net zero financial sector.”
Julie Hirigoyen, Chief Executive, UK Green Building Council, said: “We needed this COP to deliver global commitments to limit temperature rises to 1.5C and whilst it is far from perfect, the Glasgow Climate Pact is a step in the right direction but far more still needs to be done.
Important progress for our sector has been achieved through initiatives which will help drive the decarbonisation of key construction materials. Likewise, we have also seen a powerful drive on steering private financial capital towards low-carbon investment, with welcome initiatives targeting disclosure, credibility and transparency. However, much of the momentum has come from the market with a multitude of impactful global climate action initiatives announced by the Building to COP Coalition, Race to Zero and World GBC.
As we look to move from pledges to action, especially here at home, the launch of UKGBC’s Whole Life Carbon Roadmap for the UK Built Environment marks a significant milestone. Co-produced and supported by key industry organisations, it sets out a clear pathway of the policies and stakeholder actions we need to reach net zero moving forwards. With forthright action lacking at the COP26 negotiating table, it's now even more important to deliver measurable action through implementing the Roadmap here in the UK.”
Colin Skellett, Group Chief Executive, Wessex Water said: “The fallout from COP26 will continue to be picked over in the months ahead. Irrespective of the global outlook, UK business is primed to play its part and needs long-term certainty from government and regulators. Coming away from COP26, we need an ongoing strong commitment from the government to deliver Net Zero in partnership with the private sector as part of its wider environmental goals. This should include mechanisms and incentives to attract private investment in new technologies and nature-based solutions to decarbonize our supply chains.”
Rick Willmott, Group Chief Executive, Willmott Dixon, said: “We welcome the leadership demonstrated by the UK government at COP26 and are delighted that many world economies and large companies have like Willmott Dixon committed to a net zero transition pathway aligned to 1.5C. We now urge others to join us in turning their commitments into action to deliver a world fit for future generations. It really is Now Or Never.”
Darren Moorcroft, CEO, Woodland Trust, said: "At COP26 it has become clearer than ever that we must urgently drive down emissions and do all that we can to ensure that staying within 1.5 degrees stays alive. The stakes could not be higher. Life depends on it and that requires leadership which extends way beyond Glasgow and enables everyone to play their part to the full.
Another powerful message emanating from COP 26 is that restoring nature is central to tackling the climate crisis and that they are two sides of the same coin. Post COP, we must protect and expand vital habitats such as woodland with a renewed energy and sense of purpose both at home and abroad. The UK's desire to lead on climate must not end with the Glasgow conference. Instead, we need the Government be a loud voice on the international stage while implementing the Net Zero strategy at home by seeking out every opportunity to do more and faster for nature and climate together."
David Symons, UK Director of Sustainability, WSP said: “COP26 has to be viewed as a success. National carbon commitments are at the higher end of expectations and there’s been many standout pledges from decarbonising transport to halting deforestation. These all support WSP’s goal of halving the carbon of our designs and advice by 2030. But perhaps most important is the leadership that chairing COP26 has brought to the UK. For the first time we have a clear, long term national Net Zero Strategy which sets out clear plans. The UK’s Net Zero Strategy, the new Environment Act, and the global commitments made during COP26 are warmly welcomed, and need now to be implemented at scale, at pace and in full.”
- FOOTNOTES -
 Glasgow Financial Alliance for Net Zero (November 2021) Amount of finance committed to achieving 1.5C now at scale needed to deliver the transition
 BBC News (November 2021) COP26: China and US agree to boost climate co-operation
 BBC News (November 2021) COP26: World leaders promise to end deforestation by 2030
 BBC News (November 2021) COP26:US and EU announce global pledge to slash methane
 COP26 (November 2021) Breakthrough agenda – launching an annual global checkpoint
Reacting to the Environment Bill becoming law, Nick Molho, Executive Director at the Aldersgate Group, said: “The passage of the Environment Act into law marks a major milestone for the UK, particularly as it hosts the important COP26 climate summit. Having a framework which supports nature restoration and looks at the whole of the environment – including land as well as sea – is a key step forward in efforts to reverse the decline of nature. Businesses have long supported an ambitious and robust Environment Act, and having legally binding long-term targets will play a significant role in making continuous improvements to the natural environment.”
Nick Molho added: “Going forward, our collective attention should turn to delivering the ambition of the Environment Act on the ground. The forthcoming consultation on the development of the long-term targets must deliver ambitious targets that reflect the urgency and scale of nature restoration required. Similarly, it will be important to ensure that the new Office for Environmental Protection is able to carry out its function of holding the Government and public bodies to account, and that there are strong and credible interim targets in place to support short-term delivery. Finally, to be delivered effectively and affordably, the targets of the Environment Act must be embedded across government policy in areas such as planning and agriculture.”
Reacting to the United Nations Secretary General's proposal to set up an independent expert panel to review net zero targets, Nick Molho, Executive Director of the Aldersgate Group, said: “In the run up to COP26, an increasing number of businesses have recognised the commercial and moral imperative of playing their part to tackle climate change, and have taken on net zero emissions targets. This is welcome. But it is important that there is a strong baseline and level playing field in place that allows investors, businesses, consumers and the public to independently assess the credibility of different commitments and the progress that individual businesses are making to meet them.
Nick Molho added: Ensuring that net zero emissions targets, and the plans to achieve them, are based on scientific, transparent and comparable criteria is not only key to building public and consumer trust, it is also essential to guide investment decisions. An increasing number of investors want to grow their investment in low-carbon technologies, infrastructure and services, and to do so, they need to have a clear picture of businesses’ climate commitments. So, as a business organisation that has always stood for robust targets and disclosure requirements, the Aldersgate Group supports the UN Secretary General António Guterres’ proposal to set up an independent UN-led expert panel to provide recommendations on the most credible ways in which businesses should set net zero targets.
Nick Molho concluded: To be effective, an independent UN panel should build on the most credible target setting frameworks that exist already, such as the Science-Based Target Initiative, as a lot of work has already gone into identifying what constitutes robust, science-based criteria. Providing independent recommendations and guidance on how businesses should develop their net zero transition plans and report on the progress they are making against their targets would also be welcome.”
Responding to the announcement that over half of FTSE100 companies are now committed to eliminating their contribution to climate change by 2050, Nick Molho, Executive Director at the Aldersgate Group, said: “The fact that 60% of the FTSE100 has signed up to the Race to Zero shows that businesses in multiple sectors of the economy are already well engaged in the transition to net zero emissions. This is also not just about large businesses - many SMEs are taking action as well. There is much that the business community can do to support the move to net zero, including setting ambitious targets, backing these up with credible delivery plans and crucially requiring their supply chains to drive down their own emissions. However, businesses need the support of stable and long-term policies to help them get to net zero and this will be particularly key in areas such as heavy industry and agriculture, where cutting emissions is particularly complex.”
Ahead of the COP26 international climate summit, the Aldersgate Group and leaders from business, academia, and civil society are urging world governments to respond to the challenges set by the UK Presidency  and seize the opportunity the talks present to deliver a clear pathway towards keeping average temperature increases to within 1.5C.
They emphasised the significant economic opportunity presented by the transition to net zero emissions, called on all major emitters to increase their emission reduction pledges (NDCs) in line with the 1.5C target and called for progress on meeting climate finance pledges to developing countries, phasing out coal, progressing rules for international carbon trading and mobilising international finance towards low-carbon infrastructure.
The IPCC’s recent Sixth Assessment Report  delivered a clear message to policymakers, declaring a code red for humanity and stressing the need for immediate action to address the climate crisis. COP26 is a crucial inflection point, and with the right commitments and negotiation progress, it provides a unique opportunity to put the world economy on a clear pathway towards net zero emissions and preventing warming of more than 1.5C.
Although welcome commitments have been made by a growing number of economies such as the United States, Japan, the European Union, and the UK ahead of the talks, further commitments and negotiation progress are needed in several areas.
In particular, it is vital that a growing number of major emitting nations increase the ambition of their NDCs – and put in place credible delivery plans - to put the world economy on a pathway to net zero emissions and towards limiting warming to 1.5C. Urgent progress is also required on delivering the promised $100bn of climate aid promised to developing nations, agreeing a phase out date for coal, finalising a rule book to set up a credible global carbon market under Article 6 of the Paris Agreement, joining up innovation efforts to decarbonise some of the most complex parts of the economy such as heavy industries, and mobilising much larger pools of investment towards low carbon technologies.
Nick Molho, Executive Director of the Aldersgate Group said: “COP26 is a crucial opportunity to show that the international community can build on the Paris Agreement and take another step towards significantly reducing global emissions. The stakes couldn’t be higher, with the IPCC leaving us in no doubt that we have reached a code red for humanity. Businesses now want to see bold commitments and tangible steps from all major emitters to get the world on track for the 1.5C target, prevent the worst impacts from climate change and unleash the low carbon investment the world economy urgently needs to see.
The UK Presidency has demonstrated welcome leadership in the run-up to the summit, through its diplomatic efforts and the release of the UK’s Net Zero Strategy, it’s now time for all major emitters to translate this into success at the summit.”
Henrik Pedersen, CEO, ABP, said: “ABP strongly supports the UK Presidency’s ambitions for COP26. It is essential that governments recognise the critical role that ports around the world play in reducing emissions. As the UK’s leading ports group, ABP is setting the pace in decarbonising our own operations (down 35% since 2014), and we are one of UK’s largest corporate generators of solar energy with 6.5MW. As well as providing strategic locations for the decarbonisation of supply chains, we are helping deliver the UK’s wider climate objective by supporting the offshore wind and renewable energy sectors, and the decarbonisation of industry through the growth of hydrogen and carbon capture and storage technologies.”
Andy Wales, Chief Digital Impact and Sustainability Officer, BT Group, said: “What we need to see now, from both governments and businesses, are clear action plans to deliver pathways to 1.5 degrees Celsius. We urge leaders from around the world to step up in committing to net zero targets. At BT, our path is clear – we have a target to be a net zero emissions business by 2030 for our own operations and 2040 for our supply chain and customer emissions.”
Duncan Price, Global Leader for Sustainability & Climate Change, Buro Happold, said: “The publication of the UN IPCC Sixth Assessment Report, the COP26 climate summit and the associated Race to Zero campaign have shifted the political narrative, catalysing corporate commitments like never before. Now we need the world’s governments to play their part and deliver a clear pathway towards keeping the 1.5C target alive.”
Steve Murrells, CEO of Co-op Group, said: “We all have to recognise that we are in the grip of a climate crisis and need to act accordingly. Put simply, we need to reduce the amount of carbon we put into the atmosphere – and we need to do that now.
We need co-operation at the heart of our collective response if we are to successfully tackle the climate crisis at a global level. I believe it is vital that world leaders seize the moment in Glasgow, and then ensure they legislate, regulate and incentivise when they get home to ensure that all businesses step up.”
From the producers and manufacturers in our global supply chain, to every community we serve here in the UK, the impact of climate change is already being felt, and is only going to be felt more acutely in the years ahead, unless collective action is taken now.”
Iain Patton, CEO, EAUC – the alliance for sustainability leadership in education, said: “As UN Observers at COP26, representing the EAUC Community of over 7000, the EAUC delegation of staff, members, sector leaders and students is in Glasgow to ensure that education is at the heart of climate action! We have been working hard in the run-up to COP26 to ensure that UK and Irish Governments establish policies and funding that will enable universities and colleges to lead on implementable and aggressive emissions reduction policies. We are also working to address climate governance and sustainability in education that students urgently need to create a world with a safer climate.”
Sarah Mukherjee, CEO, IEMA, said: “The history of climate negotiations has been punctuated by the highs and lows of judgements passed on previous conferences. Glasgow must be different. Time is now too short and the stakes too high for COP26 to fail. Yet success is not certain; leaders must now step up if 1.5°C is to remain even an aspirational target and the necessary finances for achieving net zero are to be put place, to avoid a path leading to catastrophic global warming. But leadership must be inclusive, coming from all levels and sectors of business and industry, if Glasgow is to be remembered as the moment the world woke up.”
Peter Jelkeby, Country Retail Manager and Chief Sustainability Officer, IKEA UK & Ireland, said: “Climate change is one of the defining issues of our time and we’re determined to show that it’s good business to be a good business. At IKEA we want to show that healthy and sustainable living can be affordable, attractive and convenient for the many. Today, we are already supporting our customers to live more sustainable lifestyles, whilst helping to create the circular economy that we’ll need to transition to net-zero. We are proud to be a Partner of COP26 and will work closely and collaboratively with the UK Government and other partners to seize this opportunity for ambitious climate action and with world leaders gathered together, this is a historic opportunity to turn the tide on climate change.”
Alyssa Gilbert, Director of Policy and Translation, Grantham Institute – Climate change and the environment, Imperial College London, said: “We call for governments to commit to ambitious greenhouse gas reduction targets, adaptation plans and a strong climate finance package to drive the essential short and medium-term action needed on climate change. These international signals and roadmaps create the momentum and expectations for the future that will allow the strategies and actions that business, nations and civil society are trying to implement to thrive. Sitting in a university, we want our knowledge and innovations to be implemented and scaled up around the world, driven by these global signals.”
Sam French, Business Development Director, Johnson Matthey, said: “It is crucial that world leaders show clear ambition and adopt bold commitments on the key priority areas outlined for COP26. A positive outcome at the summit will provide businesses with further confidence to continue their investment in the innovative technologies needed to reach net zero. At Johnson Matthey we have seen first-hand the economic opportunities associated with the energy transition, through schemes like the HyNet industrial cluster in the North West of England, where industry will be powered by hydrogen.”
Simon Virley, Vice Chair and Head of Energy & Natural Resources, KPMG UK, said: “COP26 must keep alive the Paris Agreement goal of limiting global warming to 1.5 degrees. The effects of climate change are already evident around the world, even with 1 degree warming on pre-industrial levels. At KPMG, we are doing our bit with a global commitment to reach Net Zero by 2030, and helping our clients navigate the risks and seize the opportunities created by the energy transition.”
Nigel Wilson, Group CEO, Legal & General, said: “Climate is not only the most urgent issue but also the biggest investment opportunity of our lifetimes. We can harness the power of business and markets to make sure that the transition happens. We must all now move from promises and commitments to action and delivery. Our roadmap to net zero focuses on funding the transition to support a low carbon future and deliver secure returns. We are investing in renewable energy, and we have actionable climate plans in place across our major business areas including investments, housing, and commercial property.”
Phil Bentley, Chief Executive Officer, Mitie, said: “The UK continues to lead the way globally in driving decarbonisation across both the public and private sectors. However, if we are going to meet the stretching targets needed to limit the impact of global warming, we all need to go even further, and faster, and make net zero a reality. With COP26 in a matter of days, we all need to take responsibility. Now is the time for Governments from across the world and industry to work together to take even bolder action.”
Duncan Burt, Chief Sustainability Officer, National Grid, said: “We want to hear strong alignment from the major economies including the US, China, the EU and wider G20 on the pace of change and action being taken during this decade to cut carbon emissions. That means a faster transition to electric vehicles, an end to burning coal, investing in renewable energy and financial support to help nations tackle the impacts of climate change.”
Stefano Agostini, CEO, Nestlé UK&I, said: “The window of opportunity to take action is closing. Collective global ambition and commitment are urgently needed if we are to limit climate change below 1.5 degrees of warming and avoid dangerous and irreversible tipping points. As a food and drink business operating in 187 countries globally, we need bold commitments from governments that chart a course towards achieving this so that we too can meet our goal of reaching net zero by 2050 and halving our emissions by 2030. COP26 is therefore an incredibly important moment for us and for society. Together, with clear ambition, clear action and courageous collaborations we can make this a good COP that we can look back on with pride.’
Larissa Kennedy, President, NUS, said: “Improving the ambition of Nationally Determined Contributions isn’t the real challenge at COP26. Our real challenge is getting political leaders to honestly and urgently deliver the rapid carbon reductions and climate aid they have already pledged. Young people are tired of broken promises. My generation will never forgive them if they continue to fail to deliver.”
Philippa Spence, Managing Director, Ramboll UK, said: “Now is the time global leaders have to be bold. Going into COP there is no doubt as to the weight of responsibility they are carrying. As an industry we urge them to make the hard, but necessary decisions to deliver their NDC’s in line with the 1.5C target, do the just thing for developing nations to support their transition and finalise the Paris rulebook.”
Beccy Speight, Chief Executive, RSPB, said: “We are in midst of a nature and climate emergency, our wildlife and wild spaces are under threat at a time when nature-based solutions should be part of our response to climate change. As well as helping carbon sequestration, investing in nature can also lead to the creation of new jobs; cleaner water, air, and healthier soil; better and more resilient protection against the impacts of climate change such as flooding and drought; and benefits to our mental and physical health whilst simultaneously restoring the wildlife we love. In short, we can revive our world, we can leave a positive legacy for the next generation.
As hosts of the summit, the UK must ensure that COP26 is remembered as a moment when the world not only kept the goal of limiting temperature rises to 1.5 degrees of warming alive, but also set the agenda for how commitments will be backed with financed actions, including for nature.”
Carl Ennis, CEO, Siemens plc, said: “Climate change is a global issue that needs to be addressed locally. Many of the technological solutions to Net Zero are already available, but more needs to be done to deliver them at scale. Governments, local leaders, industry and investors must work together to unlock the finance needed to accelerate change.”
John Scanlon, Chief Executive Officer, SUEZ recycling and recovery UK, said: “The circular economy, resource efficiency and sustainable waste management are notable by their absence on the COP26 agenda but with resource use driving half of the world’s climate emissions, they represent a significant opportunity for governments to up the ambition of their emission reduction pledges and move towards one world living.”
Maria Connolly, Head of Clean Energy and Real Estate and Executive Board Member Responsible for Sustainability, TLT LLP, said: “COP26 is no time for half measures. The agreements and policies coming out of this summit need to be as bold as they are effective at keeping average temperature increases to within 1.5C. In fact, major organisations are begging governments to impose more stringent climate rules on the business sector, and businesses urgently require greater clarity and incentives to steer the corporate ship away from carbon emitting practices and more quickly in the direction of a greener future. This is the right thing to do, and it makes great economic sense. It is time for the world’s leaders and negotiators to get specific about the path to net zero, and serious about the 1.5C target.”
Simon McWhirter, Director of Communications, Policy and Places, UKGBC, said: “Limiting global temperature rise to 1.5 degrees is a non-negotiable, and although it’s sometimes seen as a hackneyed phrase, we are truly now at a critical tipping point; one when world leaders must seize the opportunity to set and protect the 1.5 degree pathway. The built environment is a major contributor to global emissions and our buildings - and the communities that live and work in and around them - will be especially vulnerable to the catastrophic consequences of climate change if we do not act decisively. We already have many of the solutions required to build better now, and our sector stands ready to play its part. We are therefore calling on world leaders to set out ambitious plans and start the action to accelerate the capacity of our industry to deliver, through ambitious green finance mechanisms, standards and global net zero commitments. Ambition is critical but plans and action are even more so.”
Mary Thorogood, Director, Head of Public Affairs Northern and Central Europe MarCom, Sustainability & Public Affairs, Vestas, said: “At COP26 next week in Glasgow, governments around the world must move from talk to action in order to achieve the goals they’ve signed up for as part of the Paris Agreement. Through the drastic scale up of renewable technologies like wind energy, let’s decarbonise all sectors of the global energy system and scale up, now!”
Rick Willmott, Group Chief Executive, Willmott Dixon, said: “The built environment sector contributes 39% of global carbon emissions. Last year we announced what we believe are the construction industry’s most ambitious sustainability targets to 2030 because we see that putting net zero and green growth at the heart of our business is core to our continued development and success. Around 350,000 new roles in construction alone could be created by putting the UK on track for net zero emissions by 2050. We urge both world economies and large companies to join us in committing to a net zero transition pathway aligned to 1.5C.”
 Rt Hon Alok Sharma MP (October 2021) Paris Promised, Glasgow Must Deliver, 2021
 IPCC (2021) Sixth Assessment Report, 2021
Reacting to the Budget and Comprehensive Spending Review announced by the Chancellor of the Exchequer today, Nick Molho, Executive Director at the Aldersgate Group said: "We recognise that this was a tricky Budget to deliver after a uniquely challenging period for the UK economy, and the desire to stimulate economic activity across the country was welcome. However, coming a week after the welcome publication of the Government’s Net Zero Strategy and its Green Finance Roadmap and a week ahead of COP26, it is disappointing that the Chancellor’s Budget contained so few references to the Treasury’s role in supporting the UK’s net zero transition and its other environmental ambitions. Economic evidence is clear that investing in low carbon infrastructure and nature restoration delivers high economic growth multipliers in terms of job creation, productivity gains and in generating the tax revenues the Chancellor needs to fund high-quality public services, as well as driving economic activity across the country. 
The Chancellor’s commitment to increase investment in skills and education is welcome but significant attention must now be given to putting together a comprehensive low carbon skills strategy, which will ensure that students and those already in the workplace are both equipped with the skills they need for a net zero emissions economy. This must include a comprehensive response to the key recommendations recently made by the Green Jobs Taskforce." 
Nick Molho added: "It was positive to see the progress the UK is making in areas such as green finance, including through the UK Infrastructure Bank’s first investment this week. Going forward, the Bank’s investments should be predominantly targeted in complex areas such as building retrofits and others that require significant funding to ensure viability, like hydrogen and carbon capture.
It will also be important to see tangible increases in funding for local authorities to deliver decarbonisation, as they have a crucial role to play in delivering essential clean energy, transport and skills investment at a local level. Finally, the government must ensure that new fiscal measures do not undermine the UK’s progress towards net zero. In areas such as transport, the main focus must be to make low carbon forms of travel like rail and bus links as reliable and affordable as possible, rather than subsidising domestic air travel.” 
 Zenghelis, D. and Rydge, J (2020) Rebuilding to last: how to design an inclusive, resilient, and sustainable growth strategy after COVID-19, commissioned by the Aldersgate Group: https://www.aldersgategroup.org.uk/asset/1684
 Aldersgate Group was part of the Green Jobs Taskforce and helped shape the final recommendations of the report: https://www.gov.uk/government/groups/green-jobs-taskforce
 Earlier today the Aldersgate Group launched its Net Zero Strategy Policy Tracker, which you can access here: https://www.aldersgategroup.org.uk/asset/2019
Today the Aldersgate Group has published its Net Zero Strategy policy tracker, which summarises the positive announcements in the Strategy, identifies remaining policy gaps on a sector-by-sector basis, and highlights the next steps for building on this ambition and accelerating progress towards a prosperous net zero economy.
The Aldersgate Group welcomes the publication of the Net Zero Strategy, alongside the Heat and Buildings Strategy, Net Zero Review, and the Greening Finance roadmap last week, which provide a clearer framework for how the UK will meet its carbon budgets and drive job creation, innovation, and business competitiveness in the process. Setting out a clear blueprint for achieving net zero ahead of the COP26 negotiations is essential for persuading other large emitters to adopt more ambitious emissions reductions targets and showing how these can be delivered in practice.
However, key policy gaps remain, particularly in crucial areas such as energy efficiency, heavy industry decarbonisation, agriculture and land use, and skills. The policy briefing launched today discusses the main decisions that still need to be put in place to enable businesses across all sectors to cut emissions, boost their competitiveness and deliver productivity gains in the process.
Key recommendations include:
The 15 page document makes concise recommendations to build on current progress, covering all of the major areas in the strategy; including power, hydrogen, industry, heat and buildings, transport, finance, and skills. It also highlights the next steps for engaging the public in the transition, in particular in relation to the rollout of new technologies and home retrofits.
Ana Musat, Head of Policy at the Aldersgate Group said: “The Net Zero Strategy represents an important step forward for the UK as it looks to decarbonise and seize the economic opportunities that a successful transition to net zero emissions could provide. It shows crucial leadership ahead of COP26 and sets a clear direction for climate and environmental policy in the coming years.
There are however areas in which the Strategy must go further to deliver emissions reductions and provide the support and market signals that businesses need to invest in low carbon solutions. In this briefing, we offer a clear roadmap for building on the Strategy in the coming years and accelerating the net zero transition, while also delivering economic benefits and engaging the public in the process.”
The Aldersgate Group welcomes the publication of the Net Zero Strategy today, highlighting the significant growth and job creation opportunities that a successful transition to net zero emissions could provide to the UK economy. The Group urges Government to build on this progress and rapidly firm up the policy detail that is required for these benefits to materialise in key areas such as energy efficiency, heavy industry, and nature.
Nick Molho, Executive Director at the Aldersgate Group, said: “The evidence is clear that the transition to net zero emissions is a major opportunity to deliver economic growth and trigger job creation in multiple sectors of the economy throughout the country.  Whether we achieve this in practice is ultimately down to the decisions we take today, and having a clear policy plan in place is critical. Today’s Net Zero Strategy is an important step forward towards achieving this.
The Strategy sets a clear overall direction for the UK economy, recognises the critical importance of public policy signals to attract private sector investment and contains positive measures in the power, transport and heating sectors. The commitment to fully decarbonise the power grid by 2035 will provide an essential bedrock to cost-effectively cut emissions in many parts of the economy and reduce exposure to fossil fuel price fluctuations. The commitments to kickstart the electric heat pump market, introduce mandates to scale up zero emission vehicle production and increase investment in local on-street residential charging are particularly welcome.”
Nick Molho added: “There are a number of areas where further policy clarity is required to put the UK on course to meet the Sixth Carbon Budget. These include putting in place clear regulatory targets and fiscal incentives to drive investment in energy efficiency retrofits, which is essential to ensure a cost-effective roll-out of low carbon heating, lower household energy bills, and reduce demand on the UK’s power grid.
Whilst the ambition to develop four low carbon industrial clusters by 2030 is positive, upcoming consultations will need to result in clear business models to support the scaling up of carbon capture and storage, hydrogen and electrification in industry. Greater attention should also be paid to connecting dispersed industrial sites - such as cement, glass and ceramics - with the low carbon infrastructure that will be deployed in industrial clusters.  Beyond the commitments on tree planting and peatland restoration, the Environment Bill should be used to set a broader and more ambitious set of nature restoration targets, underpinned by ambitious environmental improvement plans, to help the UK adapt to climate change and deliver much needed negative emissions.”
Nick Molho concluded: “Looking ahead, it is important that the Government continues to focus on the ‘people dimension’ of the net zero transition. This should include a clear strategy to put in place quality standards and information campaigns to support citizens throughout the transition to low carbon heating. Following the recommendations of the Green Jobs Taskforce, this should also include the development of a comprehensive low carbon skills strategy that will ensure that both the current and future workforce are equipped to seize the employment opportunities created by the transition to a net zero emissions economy. 
- FOOTNOTES -
 Aldersgate Group, Rebuilding to last: how to design an inclusive, resilient, and sustainable growth strategy after COVID-19: https://www.aldersgategroup.org.uk/asset/1684
 On 9 September 2021 the Aldersgate Group released a report with Frontier Economics on Accelerating the Decarbonisation of Industrial Clusters and Dispersed Sites: https://www.aldersgategroup.org.uk/asset/1976
 Aldersgate Group was part of the Green Jobs Taskforce and helped shape the final recommendations of the report: https://www.gov.uk/government/groups/green-jobs-taskforce
The Aldersgate Group welcomes the Government's announcements in relation to its Heat and Buildings Strategy, set to be published imminently, which will be instrumental in tackling the built environment’s share of emissions, representing 17% of the UK total.  To maximise economic opportunities and deliver lower bills for customers, the Group highlights the importance of additional regulatory and fiscal measures to drive energy efficiency retrofits.
Ana Musat, Head of Policy at the Aldersgate Group, said: “Decarbonising the UK’s built environment is a significant challenge, but one that comes with major opportunities – including job creation potential, reducing the UK’s reliance on fossil fuels, and delivering lower bills for customers. The strategy is set to include important measures for realising that vision, such as a commitment to accelerate the installation of heat pumps, innovation funding to bring down the cost of installation, and grants to help households meet the upfront cost. All of these measures are fundamental to deliver a fair transition to clean heat, mobilising critical private sector investment and growing supply chains."
Ana Musat added: “To build on these strong foundations, Government should set clear regulatory and fiscal measures to drive the uptake of energy efficiency retrofits, which will be key to lowering energy bills and tackling fuel poverty, as well as reducing demand on the grid. Energy efficiency retrofits can also create significant economic activity and job creation, being labour-intensive and rooted in local supply chains: 108,000 net new jobs could be created annually until 2030 through energy efficiency.  There is also potential to scale up these projects by investing in skills, for instance through the rapid implementation of the Green Jobs Taskforce’s recommendations.  Measures like the rollout of minimum energy efficiency standards for domestic buildings and commercial properties and a reduction of VAT for energy efficiency retrofits will be essential in creating demand and and attracting investment into insulation and deep retrofits.”
 Climate Change Committee, Sixth Carbon Budget
 Cambridge Econometrics & Verco for Customer Focus (October 2012) Jobs, growth and warmer homes: evaluating the economic stimulus of investing in energy efficiency measures in fuel poor homes
 Aldersgate Group has been part of the Green Jobs Taskforce and helped shape the final recommendations of the report
Responding to the publication of the Environment Agency's third adaptation report, Nick Molho, Executive Director at the Aldersgate Group, said: “Building on the recent climate risk assessment from the Committee on Climate Change, today’s report from the Environment Agency makes it clear that England is not yet prepared to deal with the impacts of climate change that we are already locked into. Efforts to adapt to climate change and cut emissions must now both be pursued with the same degree of ambition and should be hardwired across the policy making of all government departments from Treasury and housing through to transport, planning and industrial strategy. Given the immense task ahead, regulators such as the Environment Agency should be sufficiently well resourced and empowered to ensure they can carry out their critical environmental protection functions effectively.”
Nick Molho added: “A step change and a systemic approach is needed to better protect our homes, businesses and transport links, with responsibilities clearly divided between governments, regulators, businesses and homeowners. In the near term, the Government should recognise the role that early and ambitious action to restore England’s natural environment can play in helping us adapt cost-effectively to extreme weather events such as flooding and heat waves. It should use the return of the Environment Bill in the House of Commons next week to set an ambitious target setting process to significantly improve the state of our woodlands, peatlands, soils and other critical parts of the natural environment.”
Leading UK companies including various FTSE companies and financial institutions responsible for over £4.5 trillion GBP in assets have written to the Chancellor and Secretary of State for the Department of Business, Energy and Industrial Strategy calling on the UK Government to make a landmark announcement ahead of the UN Climate Change Conference (COP26) to make the disclosure of net-zero transition plans mandatory for large companies.
Signatories include FTSE 100 companies such as BT, Kingfisher, and Tesco, and financial institutions such as Aviva, Legal & General Investment Management (LGIM), and Santander, as well as industry groups such as the Association of British Insurers (ABI) and the Aldersgate Group, and civil society organisations such as WWF.
The letter notes that transition plans are needed for companies to credibly deliver their net-zero goals. The signatories also note that financial institutions will find it challenging to deliver their net-zero goals without having transition plans for companies in their portfolios.
The UK Government has already called on companies to voluntarily set net-zero targets and disclose net-zero transition plans ahead of the crucial COP26 summit in Glasgow. Moreover, the government has adopted a roadmap to make it mandatory by 2025 for large businesses and financial institutions to disclose climate-related risks and opportunities according to the recommendations of the Taskforce on Climate Related Financial Disclosures (TCFD).
However, although the TCFD this year has moved toward making transition plans a key part of its guidance, the UK government has yet to provide clarity on how the rollout of UK disclosure requirements will cover transition plans and other net-zero disclosures.
The letter therefore calls on the government to go a step further and make the disclosure of net-zero transition plans mandatory for large companies, with a clear timeline for rolling out this policy by 2025, and to help in developing official guidance on what a credible transition plan looks like.
The UK has a clear opportunity to catalyse a stronger and more resilient UK economy by helping to ensure that the business and finance community is prepared to meet the goals of the Paris Agreement. According to new analysis from WWF (embargoed 07.10.21, 00:01), currently only 19% of FTSE100 have disclosed a credible action plan to reduce their climate emissions to net-zero by 2050.
By committing to make disclosure of net-zero transition plans mandatory and to develop official guidance on transition plans, the UK would be at the forefront of global leadership on climate policy and standard-setting in green finance.
Michelle Scrimgeour, Chief Executive Officer, Legal & General Investment Management and co-chair of the UK Government’s COP26 Business Leaders Group, said:
“Climate change is one of the greatest systemic risks we face today and achieving net zero by 2050 will be crucial to help steer the world towards a more sustainable future. As founding members of the Net Zero Asset Managers initiative, LGIM is committing – in partnership and on behalf of our clients – to invest in alignment with the net zero emissions framework by 2050 or sooner. As long term investors we play a pivotal role, not only in decarbonising investment products on behalf of our clients but also influencing the real economy transition by engaging with and holding businesses accountable on their net zero transition plans.
We need to see substantial change across economies and society globally to achieve this goal. While there is clear progress in many areas of industry, it will not be enough and we are supportive of the Government in its aim to raise standards across the entire market.
As co-chair of the UK Government’s COP26 Business Leaders Group, I am encouraged by the progress that is being made and the collaboration to get there. There is still much to do and we all need to play our part. Inaction is simply not an option.”
Nick Molho, Executive Director at the Aldersgate Group, said:
“It has been welcome to see climate-related financial disclosures become mandatory for large businesses in the past year, with the UK being the first major economy to introduce such regulation. However, although 60% of the world’s largest companies now support, or report in line with, the recommendations of the Taskforce for Climate-Related Financial Disclosures, less than a third of PRA-regulated banks and building societies surveyed in 2020 had a science based target or net zero strategy.
We therefore see mandatory net zero transition plans as the natural next step to climate-related financial disclosures and one which is essential to drive good business and investment decisions and promote a level playing field. The plans will ensure that all corporates and financial institutions have a strategy in place to decarbonise their supply chains and assets and address climate risks. Introducing such a requirement will ensure businesses operating in the UK are equipped to support the delivery of the country’s net zero target and the goals of the Paris Agreement and will put the UK economy at the forefront of the global shift towards net zero emissions.”
Phil Bentley, Chief Executive, Mitie, said:
“Sustainability targets are meaningless without an action plan to make them a reality. At Mitie, we are proud to be actioning our plans and we are well on our way to meeting our target of net zero carbon emissions for our operations by 2025, whilst also helping our customers get their roadmaps in place too. By mandating that businesses disclose their own net zero transition plans, Government can play a key role in helping the nation go further, and faster, towards the decarbonisation of Britain.”
Ingrid Holmes, Executive Director, Green Finance Institute, said:
“After net zero commitments are made for 2050, the clear next step is to develop robust transition plans. To date the transition plans companies have published have been of variable quality and transparency, better guidance is clearly needed – including the role and value of including information about alignment to the forthcoming UK taxonomy.
Nick Mabey, Chief Executive of E3G said:
“This remarkable letter shows there is strong & broad business support not only for disclosing risks but also for showing how companies will actually deliver on their promises. Ahead of COP26 the UK can set a global example in flushing out greenwash by supporting firms who show true climate leadership.”
Tanya Steele, WWF’s chief executive said:
“These leading businesses are playing their part in achieving the UK’s climate goals. But recent WWF research shows that only 19% of top UK companies have published a detailed action plan to reduce their climate emissions to Net Zero. With some of the largest UK companies calling for mandatory regulation to create a level playing field, it is time for the Government to announce legislation to ensure all large businesses publish transition plans for how they will cut their climate emissions.”
Mark Versey, CEO, Aviva Investors, said:
“As a business aiming to achieve net-zero carbon emissions by 2040, Aviva supports mandatory transition plans. These are vital if companies’ net zero commitments are to translate into the reduction in global emissions required to meet the Paris Agreement. Ahead of COP26, the UK should demonstrate its international leadership on climate change by stating its intention to make transition plans a mandatory requirement.”
Sarah Mukherjee MBE, CEO at IEMA
"Translating corporate net-zero ambition into action requires credible transition plans which focus on delivery. Mandating this for large companies is a critical step towards a net-zero future."
Carlota Garcia-Manas, Head of Engagement at Royal London Asset Management said:
“In order to enable the necessary actions to support the Paris Agreement, climate disclosure needs to evolve from backward looking reporting to credible net-zero transition plans.”
Ben Wilson, Director of Corporate Affairs and Climate Change at Association of British Insurers, said:
“Transition plans will play a crucial role in meeting our net zero ambitions and forms a key part of the ABI’s own climate change roadmap. A consistent system for disclosing these plans will complement the Government’s existing commitment to mandatory financial disclosure, and allow different industries to identify where collaborative, cross-sector action can have the most impact.”