Today, the Chancellor of the Exchequer, Rishi Sunak, announced his plans to “rewire” the global financial system to better facilitate the world’s transition to net zero.

The announcement forms part of the United Kingdom’s climate action plan, as delivered at the UN Climate Change Conference (COP26) currently underway in Glasgow, Scotland.

Sunak announced three pillars upon which the government’s vision of a green new world will be based: increased public investment, mobilized private investment, and a shake-up of global financing.

Over the next five years, the chancellor revealed that the UK would contribute a total of at least $500bn toward countries in the developing world that have been devastated by the dual tragedies of the pandemic and climate change.

As part of the announcement, Sunak said that the government had established a Taskforce on Access to Climate Finance, with a committed investment of £100m already, to better aid developing countries in financing actions that mitigate climate change.

Alongside the Taskforce, billions of new green bonds will be released in the UK to directly fund renewable energy projects in the developing world.

The chancellor also announced that the Glasgow Financial Alliance for Net Zero had secured “an historic wall of capital for the net zero transition around the world.” That wall of capital being built by global financial assets worth over $130tn.

To truly mobilize private investment, however, Sunak argued that businesses must publish mandatory sustainability disclosures and climate risk surveillance in a global effort towards stronger reporting standards. Only then, he said, could investors gain the fiscal clarity required for significant investments in a world-wide net zero transition.

To that end, Sunak revealed that the UK would become the first ever ‘Net Zero Aligned Financial Centre’, pushing for legislative change that would require firms to publish their own clear plans on decarbonization, itself governed by an independent Taskforce.