Up until now, most forms of technological innovation have been driven by the urge to hasten travel and communication; to automate and mass-produce; to connect and disseminate; or to make life more comfortable, efficient and healthy. We are now on the threshold of a new era of innovation, aiming to halt and negate the negative effect on our planet of previous inventions. This is the drive to net zero, limiting the use of fossil fuels, emphasising renewable energy and reversing the post-industrial growth in greenhouse gas emissions.
Financial firms have a central role to play in this effort, providing credit and intermediating the vast levels of investment required to support the transition to low-carbon – estimated to be between $3-5trn of additional funding every year for the next 30 years. We are unlikely to create new green technologies ourselves, but we can help channel resources into them, as well as into infrastructure projects that will build up our low-carbon energy capacity.
We are now on the threshold of a new era of innovation, aiming to halt and negate the negative effect on our planet of previous inventions
The transition to low-carbon will be a fundamental re-organisation of the global economy, affecting every business in every sector. For a bank like Barclays, this is an enormous opportunity for us to form new relationships with customers and clients, and to deepen the ones we already have. It is difficult to be precise about the magnitude of this opportunity, much as it would have been difficult to predict the value of the internet revolution in the mid-1990s, but we know it will be enormous. This could be a new industrial revolution, and we want to be the partner of choice to our customers and clients as they navigate it.
At Barclays, we are already using our balance sheet, investment banking and capital markets expertise to help deliver advice and finance to support the net-zero aim. Since 2018, we have facilitated over £65bn of Green Finance through landmark deals, including supporting the Government to launch its first ever Green Bond, raising £10bn for green projects in the UK. We are also developing retail products that help consumers and small businesses make greener choices, including Green Home Mortgages and Loans. Finally, we are investing our own equity capital in the young companies that are inventing the low-carbon emission technologies of tomorrow. Our £175m Sustainable Impact Capital programme has just made its 10th investment in an exciting UK company called Sunswap that offers a fully electric, zero-emission alternative to diesel-powered refrigerated lorries.
The transition to low-carbon will be a fundamental re-organisation of the global economy, affecting every business in every sector.
While we whole-heartedly embrace the net zero ambition, for ourselves and the world, we know how important it is that the economic opportunities presented by an orderly transition are widely shared and available, particularly in developing countries. Realising a just and orderly transition of this kind will be a massive and complex global undertaking. To achieve it, we must cooperate and coordinate globally across the public and private sectors. We need to establish common standards and transparent reporting, and to create the political and economic conditions for success. Barclays is delighted to sponsor the UK Net Zero Delivery Summit with that shared goal in mind.
C. S. Venkatakrishnan
Group Chief Executive, Barclays