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<p>The financial regulators’ primary focus must be to ensure the safety, soundness
and integrity of the markets they regulate. While the government expects that the
Bank will play a crucial role in supporting the achievement of the government’s net
zero target, it is not their primary responsibility given many of the levers for change
sit outside of financial services regulation.</p><p> </p><p>However, the Financial
Services and Markets Act 2023 introduced a new regulatory principle for the Financial
Conduct Authority, Bank of England and Payment Systems Regulator to consider in their
work. To further strengthen the UK’s regulatory regime relating to climate and the
environment, the government has embedded the consideration of the UK’s climate and
environmental targets across the full breadth of the regulators’ general functions
on a statutory basis.</p><p> </p><p>This regulatory principle seeks to cement the
government’s long-term commitment to transform the economy in line with its target
to reach net zero by 2050, and to make progress towards the government’s long-term
environmental goals, by ensuring the regulators must have regard to the government’s
commitment to achieve these targets when discharging their functions.</p><p> </p><p>This
principle does not create any specific requirements on firms. Rather, they are expected
to inform the future work of the regulators.</p>
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