With funding from the National Environment Research Council (NERC) and Innovate UK, both part of UK Research and Innovation (UKRI), the new UK Centre for Greening Finance & Investment (CGFI) will be led by Dr Ben Caldecott, the founder of Oxford’s Sustainable Finance Programme.
Dr Caldecott says,
"Climate and environmental risks to our economy and society are accelerating. The ultimate vision of the CGFI is for financial institutions to be able to access and use climate and environmental data and analytics for any point on planet earth historically, in the present, and projected into the future – allowing the greening of finance and the financing of green."
The centre will help financial institutions shift money away from risky activities which 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’s position as a world leader in sustainable finance will be underlined by the centre’s data and analytics and will draw on wide-ranging expertise from across Oxford as well as partner institutions, including the Universities of Bristol, Leeds, Reading and Imperial College, 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.
Professor Sir Duncan Wingham, executive chair of the NERC, explains,
"This investment will enable improved access to, and understanding of, physical and transition climate and environmental risks as they impact both sides of the balance sheet. It will help the finance sector to support delivery of a low carbon economy and the recovery and restoration of our natural environments."
Sustainable finance is rapidly gaining traction as a crucial component of global efforts to address climate change and help the transition to a net zero future.
The centre will provide data to all financial institutions as part of its mission to ’green’ finance and investment.
New physical hubs in Leeds and London will support companies and start-ups commercialise and export 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. CGFI will also work with finance professions, such as the Chartered Bankers Institute and Chartered Financial Analysts UK, to ensure that every professional financial decision takes climate change into account.
Energy and Clean Growth Minister Anne-Marie Trevelyan MP says,
‘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.’