The Glasgow Financial Alliance for Net Zero (GFANZ), has published a new set of documents for consultation, focused on the implementation of net zero plans.
Oliver Wyman is proud to have served as knowledge partner to the GFANZ secretariat on this work, working together with a wide array of industry participants, NGOs and other stakeholders who have provided leadership and expertise.
We see this as an important step for the financial services sector in moving from the bold pledges of 2021 into delivery and change on the ground. We highlight several key elements of note across the documents:
- At the heart of the publications is a ten-point framework for financial institution transition plans, setting out recommendations and guidance for how the net zero pledges made across the financial sector can be translated into actionable plans. This is particularly notable in a context in which several jurisdictions are moving to make transition plans mandatory. The framework includes recommendations on topics such as policies, decision-making processes, engagement with clients and investee companies, as well as the metrics and targets to track progress.
- In a context where energy security and affordability are high on the agenda, and atmospheric emissions continue to increase, there is an emphasis throughout on steps the sector can take to support real world decarbonization. This is reflected in the recommendations for financial institution transition plans, as well as workstreams focused on sectoral decarbonization pathways, and on the managed phase-out of high emitting assets
- The programme of work also seeks to advance progress at the interface of Financial Institutions and the real economy. Corporations face a growing array of frameworks and metrics assessing their performance on climate from different parts of the financial system. The GFANZ workstreams on expectations of corporate transition plans seeks to draw out the common elements of these. The stream on portfolio alignment seeks to build convergence around forward-looking metrics for assessing corporates against carbon pathways.
- The work also references the announcement of a new Climate Data Steering Committee which brings together global organizations, regulators, policy makers and private sector leaders to advise on to the creation and design of an open-data public platform that will collect, aggregate, and standardize net-zero climate transition data based on private sector climate commitments. This effort, involving leading GFANZ members, is expected to present findings in September during the United Nations General Assembly.