In landmark legislation, New Zealand becomes first to put climate impact at the heart of financial decisions
Wellington, April 14 2021: The commerce minister of New Zealand, David Clark talked about the landmark legislation the country has passed regarding the climate impact of the investments that banks make. New Zealand has passed laws that will force banks to reveal the impact their investments have on climate change under world-first legislation intended to make the financial sector’s environmental record transparent an help the public gauge their performance.
The legislation ensures financial organizations will disclose and take action against climate related risks and opportunities. The law will take effect from Monday and will impose mandatory reporting by 2023. The law intends to bring climate impact at the heart of financial decision making.
Clark, while talking to the press, said, “Becoming the first country in the world to introduce a law like this means we have an opportunity to show real leadership and pave the way for other countries to make climate-related disclosures mandatory.” He said climate reporting in now mandatory for banks, insurance companies and investment firms.
He added, “It is important that every part of New Zealand’s economy is helping us cut emissions and transition to a low-carbon future.”
James Shaw, the climate change minister said ,”We simply cannot get to net-zero carbon emissions by 2050 unless the financial sector knows what impact their investments are having on the climate.”
According to the climate impact milestones of New Zealand, Prime Minister Jacinda Ardern has committed the South Pacific nation to becoming carbon neutral by 2050 and generating all its energy from renewable sources by 2035.
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