As a much-touted green alliance of financial institutions crumbles, the private sector has once again proven unequal to the task of climate leadership. The global transition to a net-zero economy simply will not happen at the pace that is needed unless states embrace their proper role as a market maker and investor in public goods.
CAIRO – In recent weeks, several members of the Glasgow Financial Alliance on Net Zero (GFANZ) – a group of 450 financial institutions – have quit over concerns about the cost of delivering on their climate commitments. In dropping out, they have given the lie to the notion that private financial institutions can lead the transition to a carbon-neutral economy. What the transition really needs is more ambitious states that will go beyond market-fixing to become market shapers.
CAIRO – In recent weeks, several members of the Glasgow Financial Alliance on Net Zero (GFANZ) – a group of 450 financial institutions – have quit over concerns about the cost of delivering on their climate commitments. In dropping out, they have given the lie to the notion that private financial institutions can lead the transition to a carbon-neutral economy. What the transition really needs is more ambitious states that will go beyond market-fixing to become market shapers.