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Discussionon how do you think the effort to combat climate change is going.... Net Zero, Government Leadership, Ideas

  • 1.  Discussionon how do you think the effort to combat climate change is going.... Net Zero, Government Leadership, Ideas

    Posted 13-06-2023 14:48

    Chatham House 7/6/23 In conversation with Chris Stark


    Chris Stark CCC in discussion with Ben Yeoh  

    Chatham House Rules suspended for this meeting however comments and notes below are mine and reflect my impression of the discussion between the participants and the audience.

    CS 6 years into the job 

    My Qs 

    Q Do we need to move from the voluntary woke willing to 100% mandatory - government has to drive this eventually certainly do a lot more.

    Q Net zero is National but at a system level does that need to be net zero for all components. - Collectively sub-systems are easier to drive towards net zero. - favours collaborative pathways over isolated individual action as being the fastest route. 

    Q Fiscal transition and Public sector transition - no joined up fiscal thinking focus seems to be on political outcomes over climate for now. Public sector is not moving to address net zero challenge internally with the same effort as private sector and not being held to account in the same way. 

    Notes on Fireside Chat & Q&A


    Corporate net zero 2050 how is it going? 

    As an ask it was easy to pledge in principle. A lot of pledges were just nice to make and made without deep thought. 

    Offset credits are proving a goto crutch and potentially a huge green washing escape route. 

    In reality this will need heavy lifting for many sectors and consequently for investors and asset owners. 

    Need - planning for real transition with scrutiny of the plans and implementation

    Policy - must enable investors to invest in alignment. 

    Conflict between the mantra of Growth as a goal and Decarbonisation as a goal? 

    Growth idealisation creates a tension between needing more energy to support growth and nominal decarbonisation. Smoke and Mirror in presentations (% decarbonised measures a % of a bigger number vs measuring an absolute footprint reduction)

    Scope 3 measurement not being addressed as near impossible it's fragmented and mixed accountabilities. It makes analysis and setting goals and apportioning responsibilities tough. Growth without carbon is eventually possible but during transition there is a conflict. 

    Targets should be achievable and measurable to avoid disengagement and project failure. SMART goal setting principles. 

    Transition plan presentations: what should they look like? 

    Argument over how to drive them: advisory voluntary or mandatory. A key problem is framing what the future will be so transition to where? 

    Initial studies and stress tests multiple Central Bank studies have generally concluded we don't know enough to set very clear reliable guidelines so a lot of latitude and self defining of the pathway ahead is going on. 

    Do we integrate Biodiversity into Climate action planning and policy? 

    CS thinks start with climate and then widen to other issues only when metrics and knowledge is sufficient to define and track what is required. Biodiversity is locally complex and not easily consistently definable while GHG emissions are a convenient, relevant and now universally accepted metric and the impact is global. Keep different sustainabilities separate until we have agreed metrics and frameworks. We don't know enough yet.

    Disinvestment approach or transition support approach to investment? 

    Push back from vested interests is common - "You can't break capitalism" and quote "fiduciary duty" and the profit motive. 

    Divestment is a last resort, advocate, engage and work on change and transition. 

    Policy actions and schemes? 

    The UK has an unresolved approach on decarbonising housing. Big challenge on gas boilers phase out has polarised to a debate on hydrogen and solar or heat pumps. For historic reasons no real engagement with insulation which is a huge missed opportunity. 

    Narrative shaping and leading the conversation? 

    Media talks about catastrophic outcomes and risks creating a sense of despair. Nothing can be done. We need to create positive narratives to build popular support for action and co-operation.

    Carbon tax? 

    New government will be needed to make major changes. 

    Big levers like carbon tax, pricing and fiscal incentives need to be discussed. 

    Carbon tax would be a direction to market but political difficulty to act on it. 

    Industrial Policy and Macro Policy 

    Sectoral approach with regulation to encourage an accelerated transition is favoured approach. 

    US IRA fiscal subsidies have attracted investment and shifted the focus for private sector investment dollars regionally and by solution type. The US had to use the fiscal lever as climate is too partisan to pass other legislation. 

    UK difficulty not just on lack of clear coherent policy but with permitting planning licences bottlenecks, note these hurdles exist everywhere but are worse in the UK. 

    UK planning is very distributed. It is a challenge. 

    In the US IRA subsidies will go to US fossil fuel states which could be smart as they are lighter touch regulation states although they arguably perpetuate the oil and gas industry. 

    Adaptation's role in Investment Plans? 

    UK is slow to realise the extent of need vs other countries who are taking it seriously. 

    Flood work was more politically driven with no systemic thought of long term adaptation risk mitigation at a national level. Models exist so scenarios and risks can be explored so we should decarbonise plus make climate resilient transformation. 

    Carbon is a convenient measure for problem monitoring

    No measures yet for defining adoption pathway outcome achievements. 

    Key system risks need to be identified and adaptation risk and pathway solution developed. 


    All system and predictions are looking at declines in resilience of all systems we rely on so the truth is grim outlook. More serious planning and pathway to an optimistic outcome is needed.

    We are still working past the denial stage. 

    5 stages of change - we have achieved acceptance need now to embrace the cycle and work through to a national response to existential threat and change. 

    Acceptance that it is real is done. But we need to move to an optimistic narrative to recover and solve the challenge with widespread support and human energy. 

    Q&A sound bites and comments 

    Coal mines BAD BAD BAD idea UK threw away a leadership reputation in climate change solving huge reputational cost. With Biden policy action the UK went from claiming leadership to a faltering third place to the EU and US.

    Divestment is only a last resort 

    Decarbonising heating - District heating networks are a good contribution Disclosure rules limited effect as doesn't go further. AI can help in innovation with climate digital twins and modelling solutions etc.. But Social Justice effects and other sustainability issues and outcomes have to be reflected in targeted outcomes 

    Tax incentives experience from film industry - show investor abuse and are a  case study in failed incentives and the ability of the private sector to exploit rules for pure profit and at total odds to policy intent. New film incentives focus tax credits as a production credit. Production subsidies are proving a huge investment driver in many areas with less unintended behaviours. 

    Subsidies and "free" government support seems to work, a candle to investment moths. Perverse incentives are a big risk - need to be war games out abuses as far as possible. 

    SBTI's approach of no carbon offset in targets is leading to it becoming a key useful external plan endorsement. 

    Most effective regulations are likely to be ones that align with sectoral transition pathways so target systemic outcomes not individual level action. 

    Norway consumer EV success can it be emulated? Their subsidy cornered EV supply to make it work. Exploited ability to heavily subsidise and had the right demand size in a supply constrained market. 

    Home insulation was working to 2012 It was pulled and created a lack of industry trust in government schemes having ramped to serve an opportunity that suddenly stopped. Flip flop in policy destroyed supply chain trust so no trust no investments government policies must be trusted to be effective. 

    Questioning the value of net zero as a brand as issues are becoming polarised in the debates and used in culture wars Does allow even encourage bad stuff to still happen under the law of unintended consequences. (A replay of the ESG public debating experience)

    The EU took the ETS revenue stream and applied to the Greening Fund as soon as the UK left. The UK would have been a block on this kind of linkage and so Brexit allowed the EU to move ahead. 

    CBAM essential but it's EU origin is so politically difficult for the UK to join. Oil cash flow use? 

    COP28  in Dubai will bring the Oil industry role as an issue to fore dramatically. Just Transition issues also to continue to seek firm solutions. 

    Must move to sell a positive view to the public globally. 

    Protest movements Stop Oil campaign can feed partisan habits but keeps issue alive? XR stepped back from extreme action as learns how to manage building a wider issue movement. 

    Long term adaptation thoughts are now very much part of planning. Long term thinking needs to be more top of mind. Risks should be better described to focus thoughts. Nature committee main challenge is metrics needed can't build or frame a cohesive strategy without ways to measure the problem the impacts and the progress to attract and incentivise action.

    David Manuel
    CFA UK Sustainability Champion

  • 2.  RE: Discussionon how do you think the effort to combat climate change is going.... Net Zero, Government Leadership, Ideas

    Posted 13-06-2023 16:52

    Thank you David, this is very comprehensive and interesting. Lots of important themes there.

    On "de-growth" theories: You introduced to me the idea of "doughnut economy" - which is very interesting and we can learn more from you on that in the future posts may be?

    On biodiversity: I recently attended a webcast organised by AXA IM with Nigel Topping (UN Climate Change High Level Climate Champion) and Nicolas Loz de Coëtgourhant (Head of Sustainable Business Practices, WWF France). They echoed Chris Stark's thoughts that you shared here. The market for biodiversity is only being developed now. The metrics are being looked at, consultations are there with all stakeholders of that particular space, including agrarian companies, investors etc. There is a collaboration between BSI and Deffra on this front. But it will take them at least a year to finalize their findings and come up with initial regulations/metrics. They also shared their belief that even though there is a lot of overlap between climate change and biodiversity, and it is a nexus, still biodiversity is never likely to have one big leading single metrics (like decarbonisation for climate change). It is highly geographical, depends on local players, and will probably have several metrics.

    I will look forward to other members sharing their thoughts in this discussion thread, and thanks again for sharing!

    Aya Pariy

  • 3.  RE: Discussionon how do you think the effort to combat climate change is going.... Net Zero, Government Leadership, Ideas

    Posted 14-06-2023 08:00
    Edited by James Doyle 14-06-2023 08:10

    Good points Aya/David.  Note: nature/bio-diversity considerations have been incorporated recently into the UK's House of Lords agreed to an amendment to the Financial Services and Markets Bill (FSMB) that adds nature to the new regulatory principle on net-zero emissions.   See Financial Services and Markets Bill adds nature into net-zero regulation - ESG Clarity

    The UK Governments Green finance strategy - GOV.UK ( issued in March noted the importance of nature and bio diversity as part of its environmental framework and its support for the development of Task Force on Nature Related Disclosures (TNFD). The UK government will explore how best the final TNFD framework
    (TNFD Nature-Related Risk & Oppotunity Management and Disclosure Framework) due to be published in September 2023, should be incorporated into UK policy and legislative architecture, in line with Target 15 of the Global Biodiversity Framework. 

    On the EU side, the European Commission just released a new package of measures to build on its EU Sustainable Finance framework, including proposals for regulating ESG ratings, and amendments to the EU Taxonomy Climate Delegated Act, which expand the EU Taxonomy criteria for non-climate environmental objectives, namely: 

    • sustainable use and protection of water and marine resources,
    • transition to a circular economy,
    • pollution prevention and control,
    • protection and restoration of biodiversity and ecosystems.

    See press release, attached factsheet Factsheet.pdf.pdf for summary of measures: Proposals to strengthen the EU's sustainable finance agenda (
    James Doyle
    Director, Green Finance, Investment Management