Legal & Regulatory News

GFANZ Releases Guidance on Credible Net-zero Transition Plans and Seeks Public Input to Accelerate Action

On 15 June 2022, the Glasgow Financial Alliance for Net Zero (GFANZ) released its draft Net-zero Transition Plans (NZTP) for financial institutions. Within this draft framework, GFANZ have sought to specify the necessary steps that financial institutions should take to meet the 2050 net zero greenhouse gas emissions targets set by the UN Race to Zero campaign.

The NZTP has been introduced as a standardised framework for financial institutions and their stakeholders for the setting, reporting and monitoring of their emissions targets. It is hoped this will set a consistent pathway to align organisational business activities and net-zero emissions results.

Within the NZTP, GFANZ have set out four areas where financial institutions can better support the real-economy's transition to net-zero emissions, namely: -

• financing the development and scaling of net-zero technologies or service to replace high-emitting sources;
• increasing support for companies that already have well-established emissions targets;
• enabling high and low-emitting companies to align business activity with a 1.5 degrees C pathway for their sector ; and
• accelerating the phaseout of high-emitting assets through early retirement.

Together with the release of the draft NZTP , GFANZ have also announced the opening of a public consultation, inviting public comments on the NZTP framework until 27 July 2022.

Click here to access the GFANZ guidance.

Click here to access the draft NZTP.

Click here to participate in the public consultation.