By Paige Robinson
The Financial Conduct Authority (FCA) is taking proactive steps to understand and support the UK’s transition to net zero, including focusing on Aberdeen’s pivotal role in energy innovation.
Helen Bower-Easton, Director of Communications at the FCA, visited Aberdeen to gain insights into the region’s financial needs and opportunities in the evolving energy landscape.
During her visit, Bower-Easton emphasised the FCA’s commitment to facilitating a thriving financial services market that supports the government’s net zero ambitions.
Speaking with Aberdeen Business News, she highlighted the importance of the FCA’s role in supporting the transition.
Bower-Easton said: “What we want to do is provide an opportunity to hear from both consumers and from businesses, particularly on the energy perspectives and other organisations operating here.
“Our goal is how do we enable that fair and thriving financial services market to work.
“Here in North East Scotland, which has so many strengths to position itself globally as one of the leaders on the energy transition coupled with Scotland’s leading sustainable finance sector, it felt like a great place to come to understand the perspective.”
A key focus of the FCA’s sustainable finance work is to create an environment that encourages investment while maintaining appropriate standards.
Bower-Easton noted the importance of balancing opportunity and regulation: “We need to help create the environment where people see the opportunities for the investment and that there’s the right regulation there while ensuring there is competition within the sector and that there is the right level of informed and responsible risk-taking.”
The FCA is actively working on several initiatives to support this goal, including developing policies for transition finance, preparing for potential regulation of ESG rating providers, examining sustainability-linked loans, introducing anti-greenwashing rules, and implementing a sustainability labelling scheme for investments.
The North East’s economy is projected to grow significantly, with an expected £16 billion in investment over the next decade.
The FCA aims to support this by addressing potential regulatory barriers to investment.
Euan Ryan, External Affairs Lead at the FCA, emphasised the importance of understanding local perspectives.
He told Aberdeen Business News: “As an organisation, we are already and increasingly active in going to different communities across the UK to understand the local issues and how it can relate to our remit and our role of understanding local nuances. And I think that’s particularly true in Scotland.”
The FCA is focused on building trust and confidence in the market to encourage investment.
Bower-Easton said: “We brought forward some anti-green washing measures. We’ve also brought forward an investment labels regime for asset managers.… The importance of what we do is to make sure there’s that trust and confidence in the market because we know that helps them increase the flow of investment.”
The FCA has introduced Sustainability Disclosure Requirements (SDR) labels for funds with a sustainability objective as part of its efforts to promote sustainable finance.
These labels aim to provide clarity and consistency for investors and asset managers.
The four labels are “Sustainability Focus,” “Sustainability Improvers,” “Sustainability Impact,” and “Sustainability Mixed Goals.”
For example, Schroders has adopted these labels for ten of its funds, including the Schroder Global Energy Transition Fund, which received the ‘Sustainability Focus’ label.
This labelling system is designed to help investors make informed decisions about sustainable investments and supports the FCA’s goal of building trust and confidence in the market.
The FCA’s visit to Aberdeen addressed more than just business support and energy transition.
Bower-Easton highlighted their commitment to understanding consumer perspectives as well.
She said: “We’re meeting with one of the credit unions and we’re meeting with citizens advice.
“This reflects a really broad role that we have, and it’s always helpful just to understand the perspective of consumers on the ground, whether that’s the challenges of managing increased living costs and accessing credit, or access to cash, those sort of issues”.
The FCA’s visit to Aberdeen highlights its commitment to understanding local concerns, supporting the UK’s transition to a sustainable economy, and addressing financial issues that affect consumers daily.
By fostering an environment that encourages investment and innovation while maintaining trust and transparency, the FCA aims to play a crucial role in facilitating the flow of finance into the energy transition sector, all while keeping consumer interests at the forefront.
After visiting Aberdeen, the FCA team went to Edinburgh, where they have an established office with 290 staff.
This allowed the FCA to examine the financial services landscape and Edinburgh’s role as a financial centre, particularly in relation to sustainable finance.
