What they say:
More than 450 firms with assets totalling $130 trillion announced their commitment last Wednesday to reach net zero carbon emissions by 2050. They signed up to the Glasgow Financial Alliance for Net Zero (GFANZ). Trumpeted by Mark Carney as a “watershed” moment, the former governor of the Bank of England declared: “Right here right now is where private finance draws the line.”
Rishi Sunak, the Chancellor of the Exchequer, agreed. “This is a historic wall of capital for the net zero transition around the world,” said Mr Sunak.
The announcement might have been “watershed” but the figure was “eye watering”, prompting the Financial Times to question the $130 trillion figure, pointing out that “the market capitalisation of the world’s stock markets is only about $120tn” in the first place.
Any lay person might have thought this vast sum was being invested to make the world go green. But it did not even include a promise that would prevent financial firms from making investments in fossil fuels.
The University of Oxford’s Oxford Sustainable Finance Group said it would not be possible to deliver on climate pledges without “halting the financing of new fossil fuel infrastructure” and the GFANZ did not promise that. One campaign group – Corporate Europe Observatory – said that Cop26 “looks set to become the biggest finance greenwash in history”.
Critics pointed out that $100 billion promised to developing countries as long ago as 2009 to battle climate change in 2020 to 2025 will not be delivered until 2023 at the earliest. In other words, it’s all very well talking up a hypothetical $130 trillion, when $100 billion of real money still hasn’t been raised.