Around 450 financial institutions, with around 40% of the world’s assets on their books, have signed up to the Glasgow Financial Alliance for Net Zero (Gfanz).

The institutions control around 130 trillion dollars, more than the 100 trillion dollars that is needed to meet the 2050 net zero target, according to former Bank of England Governor Mark Carney.

But who is in the alliance, and what is it trying to do?

What is Gfanz?

Launched in April this year, Gfanz is led by former Bank of England Governor Mark Carney.

Since its early days Gfanz has grown to more than 450 financial firms from 45 countries.

Bosses from NatWest, Aviva, the London Stock Exchange and HSBC are among the 20 members of the Gfanz Principals Group, which sets the alliance’s direction.

What is Gfanz trying to do?

The alliance will work towards helping the transition to net zero – that is to say, cutting emissions so much that what little is left can be absorbed again after being emitted.

Its first target is to get more members, and it will also put an early focus on three key sectors – aviation, steel, and oil and gas – and will work with companies in these areas.

Members of the alliance will make it clear to their customers what strings will be attached to the loans they give, the investments they make, and the insurance they provide.

Who can enter?

Financial firms that want to join the club must sign up to science-based guidelines to reach net zero emissions by 2050, have interim targets for the end of this decade for their fair share of a 50% decarbonisation target, and report on their progress.

They must also publish a net-zero transition strategy and adhere to strict rules on what emissions they can offset.

What has Gfanz done so far?

Over 90 institutions came together to set up the group earlier this year, and have since set short-term targets.

This is important because getting to net zero by 2050 will also require the world to make step changes along the way.

Gfanz said that 29 of its asset owners plan to reduce emissions from their investments by 25% to 30% by 2025. It added that 43 asset managers have published targets for 2030 or sooner.