Keir Starmer has said that Labour’s landslide win means he can “hit the ground running” on green issues.
Here, industry experts give their thoughts what on the party’s sweeping victory at the polls really means for sustainable finance.
Path Financial: ‘We need real and meaningful green policies’
David Macdonald, Founder of ethical financial planners Path Financial, says Labour must stop trying to please everyone and commit to real investment in green strategies.
He said: “With a bit of luck and a decent majority Keir Starmer will be brave enough to drop his ‘Ming vase’ and turn up with some real and meaningful sustainability policies.
“Path Financial has said since we were set up that invested capital has a huge power to push the green agenda forward at pace and scale. Regrettably, governments and their addiction to oil revenue-based taxes have not helped. Indeed, the lurch to populism and pandering to the minority “defiantly disengaged” lobby has hindered confidence and dented financial returns.
“Massive investment into infrastructure, clean energy and new climate tech is what the country needs to improve productivity and regain initiative. We believe investors, the new government and the planet can all benefit from decisive and clear leadership towards a green future. It’s the ultimate and essential win-win.”
Thrive Renewables: ‘Communities must be at the heart of a net zero transition’
Matthew Clayton, Managing Director of clean energy investment firm Thrive Renewables, says change is welcome, but Labour must get public and private sectors AND communities working together.
He said: “We welcome change and look forward to prioritising action in light of the climate emergency. Labour’s manifesto outlined its ambition to double onshore wind, triple solar power, and quadruple offshore wind in the UK by 2030.
“To meet this, we need to see the public and private sector working together, as well as with communities – who we believe need to remain at the heart of a people-powered transition to net zero. What we’ll be rewarded with is cheaper bills in the long term and a cleaner, more secure energy system that allows the benefits of renewables to be felt locally.”
PensionBee: ‘Pensions could become key drivers of UK growth’
Rebecca O’Connor, Director of Public Affairs at PensionBee, says Labour’s win should bring more opportunities for people wanting to invest sustainably.
“Within pension investments, it’s possible that a greater percentage of some pension funds could be diverted to UK private equity under Labour. The party believes that pensions could become key drivers of UK growth. An increased proportion of investment in UK growth businesses by pension funds could be strongly encouraged, if not mandated by Labour. So what your pension is invested in is worth keeping an eye on, as it could change.”
Liontrust: ‘The pace of change is key’
Peter Michaelis, Head of the Sustainable Investment team at Liontrust, says Labour’s view on the pace of change for its green pledges will be the key difference.
He said: “We invest in long term structural trends around delivering a cleaner, healthier and safer world. Changes in political parties can act to speed up or slow down these trends but they rarely derail them.
“For example, coal generation of electricity fell precipitously through the Trump presidency. Equally the pace of innovation in development of medicines is driven by the pace of research breakthroughs which may be decades in the making.
“We take heart from the commonality of many of the promises in UK manifestos: better healthcare, more housing, cleaner technology, and wealth generation. What is different between political parties is their view of the pace of change and the mechanism of supporting it.
“At the end of the next five-year term, we are confident that in the UK we will see even cleaner generation of electricity due to more renewables coming on stream; greater penetration of electric vehicles making our city air cleaner; development of innovations in medicine which will improve survival rates in cancers and heart disease; improvement in the quality of our housing stock and newly built homes making them better to live in and lower energy users; and even dare hope we see improved management of pollution in our rivers and seas.”
EQ Investors: ‘Substantial changes can help stimulate the economy’
Ben Faulker, Director of Marketing and Communications at ethical financial planners EQ Investors, said the “substantial changes” on green issues promised by Labour could play a crucial role in steering the UK towards a sustainable future.
He said: “Climate change and sustainability will continue to be a huge focus for whoever wins the election. The new government will serve for most of the rest of this decade and play a crucial role in steering us towards a sustainable future.
“Labour wants to significantly improve the UK’s position in renewable energy and has committed to much-needed investment in renewables and energy efficiency. These include doubling onshore wind by 2030, doubling insulation spending, tripling solar energy, and quadrupling offshore wind.
“Taken together, these are substantial changes which can help stimulate the economy, enhance energy security, and improve living standards, as well as deliver a step change in the pace of decarbonisation.
“The role of pensions in climate change efforts was also highlighted in the Labour manifesto. Labour will look to mandate UK-regulated financial institutions, to develop and implement credible transition plans that align with the 1.5°C goal of the Paris Agreement.
“Labour has also suggested it would apply severe fines for water companies that harm the environment and pollute our rivers. This would include new powers for the regulator to block bonuses until any shortcomings are addressed.”
Triodos Bank: ‘This must be the catalyst for the pace and scale of change we need’
Bevis Watts, CEO of Triodos Bank UK, says Labour is entering government at a crucial time for the environment, and urges Keir Starmer to take clear action on sustainable issues.
He said: “This election offers an opportunity to embed a comprehensive net zero and nature positive strategy at an absolutely critical point. It must be the catalyst for an increase in the pace and scale of change on the transitions we need to see as we approach 2030, in the understanding that they will be to the benefit of everyone in the long run. We urge the Government to take an unequivocal approach to addressing these challenges.”
Switchfoot Wealth: ‘Bold action on the decarbonisation of energy is needed’
Steven Day, Independent Financial Adviser at ethical financial planners Switchfoot Wealth, says Labour’s ambitious plans on clean energy are promising, but bold action is needed.
He said: “The new Labour Government has an ambitious plan for the decarbonisation of UK energy, which requires bold action on policy to remove constraints. If they are successful in doing so, this will support the sustainable transition efforts of those businesses who have the intent and resources to invest. We hope that policy and market forces will now align in the UK, but as Globally diversified investors, much also depends on what happens in the rest of the World.”
