The transition to a net-zero carbon emissions economy by 2050 will require all organisations, in every sector, to do things differently. When overlaid with other environmental challenges, such as poor air quality in urban areas, it's easy to see why the transport sector is firmly in the headlights.
Of course, environment and climate change considerations are not the sole forces catalysing change in the sector – where and how we live and work, and the role of technology, will also have a huge impact on the future of transport and mobility. When faced with such systemic change, the high levels of uncertainty faced by those planning major transport infrastructure isn't surprising – whether they're planning new railway lines or airport capacity, or enhancing the strategic road network. Significant levels of investment are needed – and financing becomes more expensive as uncertainty increases. Climate change risks, including policy, regulatory and physical risks, can severely impact asset values and rates of return on investment. With significant impairments from climate change already impacting some company valuations, it's no surprise that the finance sector is taking action to better understand how these risks are being managed. The transition to net zero will also require major re-skilling of the workforce so that it can play its part in a clean-growth future. For example, there are no exhausts, catalytic converters, fuel tanks or gearboxes in electric vehicles, so investment will be needed to support the redeployment of workers and support for communities – a 'just' transition. We're working with the finance sector on the development of national and international standards to integrate sustainability into financing and financial services. Many thanks to those IEMA members who submitted comments on the new sustainable finance framework standard, which we expect BSI to publish before the end of the year. It's an important first step towards ensuring that the deployment of capital is done through a green-tinted sustainability lens.
