The U.K. Chancellor of the Exchequer, Rishi Sunak, has announced the U.K. Government's plans to make the U.K. the world's first net zero financial centre. Under the plans, U.K. financial institutions will need to have robust transition plans describing how they will support the transition to a carbon neutral economy. The U.K. Government intends to introduce legislative measures to make these requirements mandatory with a view to increased adoption by 2023 and will incorporate standards for these transition plans into its proposed Sustainability Disclosure Requirements, announced in October in its policy paper, Greening Finance: A Roadmap to Sustainable Investing, further details of which are set out in our related client note. On the same day, the U.K. Financial Conduct Authority published a discussion paper on proposed Sustainability Disclosure Requirements and sustainable investment labels for U.K. asset managers and asset owners. The Chancellor has also announced that $130 trillion in private sector capital is now being aligned with the climate goals in the Paris Agreement on Climate Change via the Glasgow Financial Alliance for Net Zero. The GFANZ was launched in April 2021 by Mark Carney, former U.K. Governor of the Bank of England and now UN Special Envoy for Climate Action and Finance and U.K. Finance Adviser for COP26. The GFANZ consists of over 450 financial firms from across the globe, collectively responsible for over $130 trillion in assets, who are aiming to accelerate the transition to a net-zero economy.

The Government has also published a fact sheet on its plans for the U.K.'s net zero-aligned financial centre, which provides further details on its plans.

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