There are just eight months to go before the eyes of the world fall upon Glasgow as the globe’s most powerful nations come together for COP26.
The 26th UN Climate Change Conference of the Parties begins on November 1 and for 12 days the summit will bring parties together to accelerate action towards the goals of the Paris Agreement and the UN Framework Convention on Climate Change.
As Scotland and the world deals with the immediacy of Covid-19, the summit and its impact for the country’s business leaders has often felt a long way off.
However, the clock is ticking and one of COP26’s principal partners, Royal Bank of Scotland isn’t setting an alarm but wants to make sure climate change makes a big noise -with COP serving as a catalyst for a long-term vision.
Bank CEO, Alison Rose, appointed her first director for climate, James Close, at the start of the year.
James, who was director for climate change at the World Bank for four years and also the driver behind the London Waste and Recycling Board, a partnership between the Mayor of London and the London boroughs working to reduce consumption-based emissions and waste.
In his new role at Royal Bank of Scotland, James will define and deliver a roadmap for the response to climate-related risks and opportunities. He will also set up and lead a climate centre of excellence to help the bank deliver its climate change strategy and bring all of its climate-related work together.
The new climate centre of excellence will look beyond the bank’s current commitments and activity, horizon scanning for shifts in the competitive landscape, emerging risks and new opportunities.
But is all starts with the first commitment the bank had to make to become a principal partner – working towards achieving the Paris Agreement targets as a business.
“With the science settled, the 2015 Paris Agreement was brutal in its honesty; if we want to limit global warming to 1.5 degrees Celsius then we must reach net zero global carbon emissions by that landmark half-century date of 2050,” explains James.
“Less than 30 years then to decide the future of the planet we all call our home. Suddenly, the clock’s ticking hands sound ever more apparent. I’m a stubborn optimist though and a lot of that hope comes from working for a bank that has set out a genuine agenda to drive environmental change.”
An optimist he may be, but he is a realist too. Royal Bank is part of NatWest Group and is the largest lender to the business and commercial market in Scotland.
As a country once filled with industries literally built upon its core, there is still a less than green legacy in its historical past – and there are still industries in Scotland who rely on that past for its fiscal future.
“Why should NatWest be getting involved, we’re a bank not environmentalist? It’s a good question and one that leads back to our purpose.
“As a purpose-driven bank we believe we have a massive responsibility to help tackle climate change and we know we must act now. The actions we take today truly will shape tomorrow.
“To reach 2050’s target means a huge reconfiguration of the global economy. This means not just preparing ourselves and our customers for change, but also looking at how we can help them take advantage of the many opportunities transitioning to a low carbon future will offer.”
The bank has set some big targets in its ambition to be the leading bank in the UK helping to address the climate challenge.
These include at least halving the climate impact of its financing activity by 2030 and providing over £20bn additional funding and financing for climate and sustainable finance.
The bank also aims to make its own operations climate positive by 2025, having already achieved its ambition to make them net carbon zero by the end of last year.
According to James, cutting climate change targets doesn’t mean cutting opportunities.
“Taking the necessary actions to address the climate challenge has the potential to create jobs, transform communities and touch every family in the country,” he explains.
“But that means thinking long term and acting quickly, working in partnership with others to achieve together what cannot be achieved alone.
“It’s why we’re creating products and services that will enable our customers to track their own carbon impact. We can all make positive changes, and often these will start in the home where according to UK Government National Statistics, residential properties make up 15% of the UK’s total climate emissions. Our Green Mortgage rewards people for choosing an energy efficient home with a reduced interest rate and cash back. These kinds of steps help recognise people who are trying to make a difference.
“We also want to help businesses become more sustainable. When you look at the different countries and regions of Scotland there are so many unique strengths from offshore windfarms to tidal energy to sustainable agriculture and that is hugely empowering for us as a nation as we embrace a greener economy.”
Before last year’s lockdown, the bank struck a £1.1 billion deal with Macquarie Infrastructure Debt Investment Solutions – the first of its kind in the UK – to allow it to increase lending to the sustainable and renewable energy sectors. Projects that can receive financing include onshore and offshore wind, solar farms, smart meters, energy from waste and biomass power.
As businesses prepare for the recovery from lockdown, the bank is currently working with universities across the country to help educate their staff on the issues of climate change on particular sectors and to find ways to assist.
“Our work helping businesses profit by moving to more sustainable ways of working is already having a positive impact,” says James.
“There can often be an assumption that such moves have a negative effect on a business’ bottom line, but these steps can drive real savings and growth.
“Take for example the costs of renewable energy technologies. They can be cheaper than more traditional forms. Yes, it takes investment, but there is a pay back on that. There’s also mounting evidence that people want to buy products and services from businesses that are taking steps to reduce their carbon footprint. Those that are, can build a closer, more meaningful relationship with their customers and greater longevity of business from them.”
Relationship building and listening to customers’ needs has led to the bank’s latest green drive. In February it launched a joint offering with green energy tech company Octopus Energy to provide retail, business and wealth customers the opportunity to purchase EV charge points at discounted rates. The aim is to help make it even more cost-effective for businesses to switch to greener vehicle technologies.
Similarly, the bank’s successful and over-subscribed Entrepreneur Accelerator Programme, is now dedicating 25% of places for businesses supporting environmental activities. The appetite is there.
“We will champion the fight against climate change by playing an active role in the transition to a low-carbon economy,” says James.
“In doing so we believe passionately that we will help to create a greener, fairer and more inclusive economy for all by building deeper relationships with customers and communities in every region of the UK.
“We can’t stop the clock from ticking towards 2050 but we can make sure we act with every minute that passes.”
Source: The Herald