On Monday, in London, at the Green Horizon Summit run by the Green Finance Institute, headline announcements were made by UK Chancellor of the Exchequer, Rishi Sunak and Financial Conduct Authority’s CEO, Nikhil Rathi – building on the UK’s net-zero target by 2050 and situating itself as a leader in green finance.

Importantly, Mr Sunak announced that the UK plans on issuing green sovereign bonds (known as “green gilts”) in 2021, joining a cohort of 16 other countries such as Germany and Sweden, and that the UK will become the first to mandate the Task Force on Climate-related Financial Disclosure (TCFD) by 2025, going beyond the “comply or explain” approach and requiring that large listed and private companies disclose the threats to their business from climate change. Such companies will include banks, insurance companies and pension schemes.

Mr Sunak also previewed that the UK will implement a standalone green taxonomy to the EU’s green taxonomy, taking the scientific metrics in the EU green taxonomy as its basis, which will serve as a framework for corporates navigating these additional requirements. As part of the development of such common taxonomy, the UK also intends on joining the International Platform on Sustainable Finance.

In addition, Mr Rathi announced the introduction of a new requirement for “premium listed companies”, where such companies will have to make greater disclosures as to how climate change affects their businesses from 1 January 2021.