The City’s long road to going green

The City’s long road to going green

Perhaps it pays to be realistic. Once, the City of London was the global financial capital. Then it was merely Europe’s financial capital. When it could no longer be that because of Brexit, the government wanted it to be the green finance capital.On Wednesday, the UK instead settled for the title of “world’s first net zero aligned financial centre”.

The diminishing ambition reflects the challenge facing the City in becoming a world-beating centre for green finance.

Green finance does offers a genuine opportunity for the UK’s financial centre. London can no longer serve as the gateway into European markets that it once was. The companies listed on its stock exchange can no longer compete with their megacap counterparts in New York. Its capital markets cannot offer start-ups the valuations they would earn in the US. The City needs a new pitch to global markets.

But part of the problem with green finance is that no one knows what it means. They can’t measure it, or invest in it. Suspicions of greenwashing are rife and reasonable. A cynical country could claim to be a green finance capital — or even a net zero financial centre — without that saying very much.

The way to counteract