This guest blog has been kindly contributed by David Willock, Managing Director, Head of ESG Finance & Structuring at Lloyds Bank, who are sponsoring the webinar on ‘From COVID to COP26: What more could higher education institutions do to drive environmental sustainability?’ taking place on 8 June 2021 – further details, including how to book a free place, are here.
I am delighted to have been asked to contribute to this blog and take part in the conversation on the 8 June. I am Managing Director, Head of ESG Finance & Structuring at Lloyds Bank, leading a new team but building on a much longer heritage across the Group on these matters.
My team helps clients across all sectors, including higher education, translate their sustainability strategies into financing ones. We’re also helping them stay up-to-date with global, national, sector and financing trends and considerations.
As both a Master’s student (University of Cambridge) and lecturer (University of West of England), the higher education sector is one that I love working with on Environmental, Social and Governance (ESG) issues. It is not just my personal connections with the sector but also the essential role that the sector can, should and will play as we address the multitude of challenges and opportunities that the future holds.
The COVID pandemic has been tragic on a number of levels, yet perhaps one cultural positive that has emerged is the concept of ‘building back better’ or ‘building back greener’. Stakeholders are looking to universities to demonstrate leadership in how they use their money, who they work with, how they teach, what they teach, where research is focussed and how it is funded.
It is not just this, some of these topics are deeply complicated and we now need our higher education leaders more than ever to help the public and private sectors navigate our path forward. On this topic specifically:
- The 17 United Nations (UN) Sustainable Development Goals (SDGs) were launched in 2015. Some observers may could be forgiven for thinking that the launch was more recent. Why might that be the case? The sheer magnitude of corporate interest in the UN SDGs that has emerged over the last two years.
- Meanwhile, in global financial reporting of companies across the world, we have seen a tidal wave of new disclosures on Environmental, Social and Governance (ESG) matters. Consigning, hopefully for good, the previously thin ‘Corporate Social Responsibility’ era. While enhanced public disclosure is universally welcomed, what we disclose matters.
- An increasing number of companies now outline their ‘alignment’ of business impacts to the UN Sustainable Development Goals. But the 17 UN SDGs have 169 targets underneath them and the level of disclosures of alignment at this level starts to reduce. These are deeply complicated areas, yet our higher education sector has been working on these for decades and has shown true global leadership.
It is in this convergence of increasing business statements, aligning with the UN SDGs and higher education’s deep understanding in the underlying matters where I feel there is an urgent and pressing opportunity. Private and public sector collaboration should chart a path forward based on good intentions but also sound and rigorous expertise to ensure the outcomes align with those objectives.
This is why we decided to set up our new 16-person team. It was clear to us that we are witnessing a change in our society and our financial system. While ‘the Road to Net Zero’ has many of the headlines, we are witnessing an explosion of stakeholder focus on ESG matters. As a Bank almost entirely focussed on the UK, we’re focused on Helping Britain Recover and as part of that purpose, we see this as a natural area to support our customers across our businesses.
It is important that we walk the walk too. We’re setting ourselves an ambitious goal to accelerate working with customers, government and the market to help reduce the carbon emissions we finance by more than 50 per cent by 2030. We’ve also announced three new operational climate pledges which will accelerate our plan to tackle climate change, building on our 6th place in the Financial Times list of Europe’s Climate Leaders.
Finally, by being a founding member of the Net Zero Banking Alliance (NZBA), a UN-convened, industry-led alliance of 43 banks across the world we are committed to accelerating the transition of the finance sector and the global economy to net zero emissions by 2050.