The UK Government is facing pressure from the country’s responsible investment body to ensure its new National Infrastructure Bank embeds natural capital goals into its investment criteria.
The UK Sustainable Investment and Finance Association (UKSIF), whose more than 260 members represent £10trn in assets under management, sent a series of recommendations to Chancellor of the Exchequer, Rishi Sunak, today.
The recommendations were informed by UKSIF’s Policy Committee, which includes Olga Hancock, a Senior Engagement Analyst at the Church Commissioners for England, James Corah, Head of Sustainability at ethical investment house CCLA, and Simon Oswald, Senior Manager of Public Policy and Sustainability at Aviva Investors.
The government unveiled the National Infrastructure Bank, tasked with achieving Net Zero and supporting local growth in the UK, in June. It has upfront capital of £12bn, as well as permission to issue a further £10bn of government guarantees for projects.
UKSIF is proposing that biodiversity objectives should be incorporated into the bank’s investment criteria, which are currently being developed, as part of its commitment to Net Zero.
The UK government recently announced that all major new infrastructure projects must show they contribute positively to the environment, and Environment Secretary George Eustice said earlier this year that rulemaking should seek to provide a “Net Zero equivalent for nature”.
The Dasgupta Review – a high-profile report into the economics of biodiversity, published earlier this year – was also a project led by the government.
UKSIF argues in its letter that investors need a clearer sense of risks that might develop as a result of the UK’s mission to tighten biodiversity protections – including clarity on the future treatment of subsidies and tax incentives negatively impacting biodiversity, and how biodiversity will be integrated in the Sustainability Disclosure Requirement regime previously announced by the Chancellor.
Last week the Finance for Biodiversity Pledge and US sustainability network Ceres coordinated a $10trn investor coalition to call for global government action on biodiversity ahead of COP15.