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Welcoming The New Centre For Sustainable Finance
By Dr Caralee McLiesh, Vicky Robertson and Carolyn Tremain
We are pleased to welcome the announcement of the new Centre for Sustainable Finance in Aotearoa New Zealand, following the Sustainable Finance Forum’s 2020 Roadmap for Action. We support further collaboration in the finance sector on aligning day-to-day financial decision-making with New Zealand’s long-term wellbeing goals.
Each of our agencies is increasingly focussed on climate change and sustainability issues. There is a lot of attention currently on the upcoming Emissions Reduction Plan and ensuring that finance is mobilised from the public and private sectors. This work builds on a strong body of work undertaken by the Climate Change Commission, the Sustainable Finance Forum and the Productivity Commission, each of whom have stressed the important role of finance.
Beyond the Emissions Reduction Plan, work to introduce a new climate risk reporting regime in New Zealand continues to progress. The Financial Sector (Climate-related Disclosures and Other Matters) Amendment Bill is currently before the Economic Development, Science and Innovation Select Committee. This is generating international attention as many countries now move to mandate climate-related disclosures and a lot of interest domestically too. Beyond climate risk reporting, MBIE recently published a report on International Developments in Sustainability Reporting which outlines some of the trade-offs New Zealand faces as progress towards a global sustainability reporting framework picks up speed.
The importance of responding to climate change was also reflected in a number of decisions taken through Budget 2021. For example, New Zealand Green Investment Finance Limited received a $200m capital injection, with an additional contingency of a further $100m, to help accelerate low emissions investment in the private sector. The Minister of Finance, Hon Grant Robertson, also set out his intention to recycle proceeds from the Emissions Trading Scheme towards emissions reduction programmes from Budget 2022 onwards.
The realities of climate change mean we have to do things differently. That includes how we consider climate-related investment in the public finance system as well as in the private sector, including co-investment. In his Budget 2021 speech Hon Grant Robertson noted his view that ‘the current way in which Budgets are required to be produced makes it difficult to make the sustained and long-term investments needed to fix an intergenerational, multi-faceted, complex problem like climate change.’ Our agencies are supporting the Minister of Finance and the Minister for Climate Change as the government develops a long-term plan for financing New Zealand’s climate change objectives.
We know that achieving our ambitious climate objectives will require the mobilisation of private sector capital too, in addition to sustained public investment. That is why we look forward to the important work of the new Centre for Sustainable Finance. We believe it can play a critical role in supporting, alongside the wider private sector and government, our transition to a sustainable, low emissions future.
2. https://www.treasury.govt.nz/sites/default/files/2021-05/b21-speech.pdf
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