Private investment crucial to meet climate goals – McGuinness

3 Mar 2022

Mairead McGuinness. Image: European Union 2020/EP (CC BY 4.0)

EU commissioner Mairead McGuinness told more than 100 Irish business representatives that companies and investors play a ‘central role’ in the European Green Deal.

The European Union’s finance commissioner has told Irish businesses today (3 March) that private investment is key to achieving climate goals in Ireland and the EU by 2050.

Mairead McGuinness, the EU commissioner for financial stability, financial services and the capital markets union, told a conference in Dublin today that as well as public investment, private companies have a crucial part to play in the European Green Deal’s implementation.

“While public finance is important, it will not be enough. The EU sustainable finance agenda ensures that private investment plays a central role in meeting our climate goals,” McGuinness told more than 100 delegates at a sustainability-focused seminar organised by Irish law firm William Fry.

The Green Deal is the EU plan to make the bloc climate neutral by 2050 and to cut emissions by 55pc by 2030 – a goal that Ireland has committed to.

The private sector is expected to play a key role in financing the green transition, with the strategy designed to mobilise capital markets. It also includes a range of measures that mandate sustainability reporting for most companies.

“Through setting out clear criteria on what is sustainable, as well as reporting standards, we are giving companies and investors the necessary tools so that money flows to investments that help us reach our net-zero target,” McGuinness told the delegates from Irish businesses this afternoon.

Her comments come just days after the latest IPCC report issued a stark warning that some effects of the climate crisis may soon be irreversible if governments don’t step up their efforts to meet climate goals and limit global heating to 1.5 degrees Celsius.

“This report is a dire warning about the consequences of inaction,” said Hoesung Lee, IPCC chair, earlier this week. “Our actions today will shape how people adapt and nature responds to increasing climate risks.”

Lorena Dunne, co-chair of William Fry’s environmental, social and corporate governance and sustainability practice group, said the comments made by McGuinness today “resonate strongly against the backdrop of this week’s urgent warnings from the IPCC”.

At COP26 in November last year, Ireland committed to providing €225m per year in climate finance to developing countries by 2025.

In the same month, Ireland published the Climate Action Plan 2021 with the goal of reducing overall emissions by 7pc each year, ultimately reaching a 51pc reduction by 2030 and setting the country on a path to net-zero emissions no later than 2050.

Mairead McGuinness at the European Parliament in 2020. Image: European Union 2020/EP (CC BY 4.0)

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Vish Gain is a journalist with Silicon Republic