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  • Writer's picturePeers for the Planet

Peers secure crucial changes to enable the financial sector to step up for net zero and nature

Updated: Nov 15, 2023


Financial markets have a key role to play in the transition to – and opportunities offered by - a low carbon economy. This is particularly the case for the UK given London’s global role as a financial centre and the Government’s commitment to become the world’s first net zero-aligned and nature positive financial centre.


Since the Financial Services and Markets Bill first made an appearance in the Lords last December, Peers across parties have engaged widely across parliament and with sector leaders, debating provisions (many consistently raised by Peers before the Bill was introduced) that support these aims.


In very welcome developments, the Government has confirmed they will accept a number of these arguments for the legislation to better consider UK climate and biodiversity goals.

  • In a important milestone for nature, the Bill will now include nature, alongside net zero, in the regulatory principles for financial services regulators to consider when carrying out their functions. P4P Peers secured widespread parliamentary and sectoral support for this change, including from Professor Sir Partha Dasgupta, author of The Economics of Biodiversity. This was a world leading step in a sector worth £164bn.

  • Peers secured a requirement for HM Treasury to review provisions needed to eliminate illegal deforestation financing, which, if well-conducted, and, if implemented robustly and at pace, is a positive outcome for the sector.

  • Peers made the case for an amendment to require investors to disclose the sustainability impacts of their investments in Sustainable Disclosure Requirements (SDRs). At Report stage, the Government published its own amendment requiring regulators to report on how they have had regard to any HMT policy statements on SDRs. Separately, the Green Finance Strategy also confirmed the Government remains committed to implementing SDRs and would set out further detail on implementation this Summer.

  • And, in the Government’s Green Finance Strategy, published between the Committee and Report stages of the Bill, the Government recognised a number of additional important issues raised by Peers by confirming (i) the need for further clarity on fiduciary duty for pension funds and financial firms in the context of net zero; (ii) plans for a ‘green taxonomy’; and (iii) making climate and nature offsets a regulated activity.

Given the importance of the financial markets to the UK and global economy, these are some vital first steps, that will help catalyse and enable the financial sector to play its full and critical role in accelerating domestic and global progress towards net zero and a nature-positive economy.


The Bill received Royal Assent on 29 June 2023.





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