Our monthly round-up of news, ideas and initiatives related to transforming the UK financial system for people and planet, compiled by the Lab’s CEO, Jesse Griffiths.
Climate cop-outs
This year’s global climate summit – COP 27 in Egypt – closed amid controversy as earlier fossil fuel phase-out commitments were watered down. Was this due to record fossil fuel industry lobbying? However, there were some steps forward on loss and damage funding for the poorest countries and a major new UN expert group report on net zero and non-state entities (companies, financial firms, etc.) – highlighting the risks and prevalence of greenwashing.
Meanwhile, billionaires have a carbon footprint a million times that of the bottom 90% of humanity. And find out which of the world’s 30 leading insurers are best (and worst) on climate action.
Are banks setting high enough net-zero targets? Here’s a useful toolkit for them to plan a good climate transition and here’s a way to track which banks are complying with Net-Zero Banking Alliance commitments. Sadly, 15 of the top 50 bankers of coal expansion are members.
In another blow for HSBC, more greenwashing has been uncovered in a new investigation.
Banks aren’t only falling short on climate – 38 out of 50 of the world’s largest commercial banks are implementing less than half of their human rights responsibilities.
How green is your country’s central bank?
Millions are excluded
The cost of living crisis meets the financial system: a staggering 17.5 million people in the UK are financially vulnerable, one-quarter of UK adults have less than £100 in savings, and one in six have none at all. One-quarter of Europeans describe their financial position as ‘precarious’.
Wealth inequality has risen significantly in the UK over the last decade.
Poor customer service at banks and insurers adds to the pain of people dealing with illness or bereavement.
The battle over regulation
UK financial regulators continue to fight back against government proposals that could undermine their independence. They’ve won the first battle, with the government abandoning plans for a ‘call in’ power which would have allowed them to overrule regulators. But it’s just one fight in a major war over financial sector regulation. The focus now turns to the Financial Services and Markets Bill – will it become a charter for vested interests?
Here’s a thought-provoking article on the implications of financial regulators being ‘captured’ by the industry they are overseeing. And here’s why regulators should not be cheerleaders for the industry they are regulating.
The UK Chancellor promised a ‘big bang’ of deregulation for the City – which isn’t good for the country. And here’s why his reforms to insurance regulation to ‘cut red tape’ and ‘release billions for investment’ do nothing of the sort.
Did you know that £55 billion of London property is owned by offshore companies? Meanwhile, profit shifting by multinationals to tax havens has reached $1 trillion per year. These are among the reasons MPs are calling for tougher measures in the Economic Crime Bill.
An upcoming era of financial crises?
How the rise of currency hedging is fuelling global imbalances and could put the financial system at risk. Pension experts were shocked at the hidden borrowing in UK pension schemes revealed by the recent near-crisis (triggered by the mini-Budget), which the FCA admits it wasn’t ready for.
Are central bankers engineering a worldwide slump? (Although the ECB thinks financial stability risks are growing.)
The collapse of former cryptocurrency exchange FTX is very similar to other financial crises.
Ethical alternatives
Here’s the annual report on the state of ethical banking in Europe.
Some positive news from Avon Mutual – one of a wave of new mutual regional banks that are planned for the UK in the coming years.
And finally…
Sensible wealth taxes could raise £37 billion per year in the UK.
What are ‘Trustees in Training’?
How Presidents walk – an amusing video.