£10m research centre will promote greener global finance

The UK is investing £10m in a new national green finance research centre that will advise lenders, investors and insurers.

The research centre – part of which will be based in Leeds – will enable financiers to make environmentally sustainable decisions, and support a greener global economy.

It will help financial institutions shift money away from risky activities that harm the environment, such as coal-fired power and deforestation, and towards activities that are less harmful, such as renewable power and sustainable agriculture.

The UK Centre for Greening Finance and Investment (CGFI) will be funded by UK Research and Innovation (UKRI) and led by the University of Oxford.

New physical hubs in Leeds and London will support companies and start-ups commercialise products that can green global finance, including tools that measure storm and flood risk facing properties or the pollution created by companies and the liabilities that result.

The centre will work with finance professions, such as the Chartered Bankers Institute and Chartered Financial Analysts UK, to ensure every professional financial decision takes climate change into account.

Institutions which will form part of the new national centre include the Universities of Leeds, Bristol, Reading, and Imperial College London, as well as The Alan Turing Institute and the Satellite Applications Catapult, and the Science and Technology Facilities Council.

In the summer a full range of financial institution and corporate partnerships will be announced.

Work will begin in April, ahead of this year’s COP26 UN climate summit in Glasgow.

The University of Leeds’s contribution to the project will be led by Professor Iain Clacher of Leeds University Business School and Professor Jason Lowe of the Priestley International Centre for Climate.

Professor Clacher said: “Working across the consortium we will take the best in climate science and environmental risk analytics and accelerate the adoption and use of these throughout the financial sector, helping to guide trillions of pounds of investments.

“Having a hub in Leeds will also enable the consortium to reach different parts of the finance industry that sit outside of London, but where the adoption of climate and environmental risk analytics will be key to achieving the government’s targets for achieving net-zero.”

Beckie Hart, CBI director for Yorkshire and the Humber, said: “Creation of the UK Centre for Greening Finance and Investment is an important step towards mobilising private capital towards net-zero goals.

“Leeds is rightly regarded as a fintech powerhouse, and is an ideal location for this new resource. I am sure it will play a major role in supporting industry to develop new green technology as we look towards an economic recovery with sustainability at its heart.”

Energy and Clean Growth Minister Anne-Marie Trevelyan said: “Climate change is the biggest issue that we need to tackle to protect our planet for our children and grandchildren.

“While the Government has invested billions of pounds so we can end the UK’s contribution to climate change, we will not reach our net zero target without mobilising private capital and unleashing the power of the free market.

“The UK Centre for Greening Finance and Investment in London and Leeds will encourage financial services to turn the tide of their investments and focus on sectors and companies that have a smaller environmental footprint.

“Doing so will support industries and businesses to develop clean green innovations, creating thousands of jobs across the country – ensuring we build back greener.”

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