UK finance sector emits nearly double CO2 than whole country, says new report

If the City of London were a country, it would be the 9th biggest emitter of CO2 in the world, according to new research.

That’s because UK banks and asset managers were responsible for financing 805mln tonnes of CO2 in 2019, making finance one of the UK’s biggest contributors to climate change.

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Greenpeace UK and WWF noted that UK financial institutions are not currently regulated in the same way as other high carbon sectors and, when it comes to cutting emissions, they are not legally required to align their financing activities with the UK’s or world’s climate commitments.

Instead, some banks and other financial institutions are making voluntary pledges to reduce their carbon emissions, many of which have been exposed as greenwash, and alone will not deliver the emissions reductions required to successfully tackle climate change, they added.

The activist groups called for legislation that forces all banks and asset managers to align all financing activities with the goals of the Paris Agreement.

The analysis, carried out by climate solutions and project developer South Pole, found that UK banks and asset managers financed carbon emissions that were 1.8 times the annual net emissions of the UK as a whole.

The findings demonstrate that UK finance should be considered a ‘high carbon sector’, not dissimilar to oil and gas extraction, coal mining, aviation and transport, Greenpeace said.

“Trying to set a path to net-zero emissions without tackling the UK financial sector is like sticking a plaster when the patient needs open heart surgery,” said WWF UK’s chief executive Tanya Steele.

“Despite seeing ambitious commitments to tackle the climate emergency, our finance sector is still driving global investment towards the old, destructive ways of doing business that are destroying our one shared home.”