Bank of England fuelling 3C warming: Positive Money response

London, 17 June 2021 – Research and campaign group Positive Money has called for the Bank of England to step-up its green efforts, after the Bank’s latest climate disclosure report today revealed that the central bank’s asset purchases are funding 3C global heating – double the 1.5C target the UK government is committed to via the Paris Agreement.

The Bank of England claims that the Implied Temperature Rise (ITR) of its £20bn corporate bond purchase scheme (CBPS) has fallen from 3.5C to 3C, but this is largely because of a change in methodology, rather than from any actions from the Bank.

David Barmes, senior economist at Positive Money, said:

“The Bank of England is patting itself on the back for its climate work, but has not yet implemented any policies that meaningfully support the government’s environmental objectives, as required by its new green mandate. 

“Although it’s taking steps in the right direction, the Bank must show greater ambition and leadership ahead of the COP26 climate conference. Relying on existing policies, which are focused on gathering more data, just won’t cut it.

“Our central bank must rapidly come to terms with the scale of action necessary to safeguard financial stability and mitigate climate risks. It has the mandate and the tools to take decisive action now, for instance by excluding fossil fuel companies from its portfolios and penalising dirty lending across the financial system.” 

Notes

1. The Bank of England’s climate-related financial disclosure 2021: https://www.bankofengland.co.uk/prudential-regulation/publication/2021/june/climate-related-financial-disclosure-2020-21 

2. Positive Money is a research and campaign organisation working towards a money and banking system which supports a fair, democratic and sustainable economy. Set up in the aftermath of the financial crisis, Positive Money is a not-for-profit company funded by charitable trusts and foundations, as well as small donations from its network of over 65,000 supporters. www.positivemoney.org.

3. For more information from Positive Money or to arrange a briefing/interview with a spokesperson, please contact press@positivemoney.org.uk or Simon Youel on 07817765517