The Final Report recommends five themes that financial institutions should incorporate into their net zero transition strategies.
By Paul A. Davies, Michael D. Green, and James Bee
On 1 November 2022, the Glasgow Financial Alliance for Net Zero (GFANZ) issued its Final Report on the Fundamentals, Recommendations, and Guidance for Financial Institution Net Zero Transition Plans (the Report). The Report sets out a framework for transition planning, identifying financing strategies for financial institutions to effectively transition to net zero, and makes recommendations for implementing these strategies.
Legislators and regulators around the world have long recognised that one of the most effective ways to drive change is by focusing the minds of management — specifically by attaching individual accountability for ensuring that an organisation meets expected standards. Transitioning to net-zero carbon emissions has now become a critical priority for many governments, and the spotlight is shining on the boards of financial institutions and companies to drive that change.