Knowledge and Insight

July saw markets respond to signals from central banks, with some clearer indications of rate cut timings for the US and Europe, while the Bank of England cut its base interest rate to 5% - the first rate cut since March 2020. Despite a political backlash against diversity, equity and inclusion (DEI) in the US, companies remain focused on their DEI commitments, and in the UK, job preservation becomes a focus in the transition to greener steel production.

David Cox has been appointed the new head of Greenbank and will take over the role from John David, a founding member of Greenbank, who is due to retire at the end of September.

In this issue of the Greenbank Review, we report on our 2024 Investor Day. The discussion focused on the social, environmental and economic risks posed by water scarcity, and the potential for companies and investors to offer solutions to these challenges.

Despite inflation moving closer to stated targets, central banks have remained cautious as the focus in France, UK and the US shifted to major elections. The passing of the EU’s Nature Restoration Law signals good news for restoring Europe’s degraded ecosystems and boosting regional biodiversity, but UN climate talks have led to little progress on agreeing a global funding bill to help the developing world fight climate change.

We are delighted to have been shortlisted in six categories of the Investment Week Sustainable Investment Awards 2024.

There was increased optimism in the global economic outlook in May, but potential taxes and service charges on EVs and hybrid vehicles threaten to slow the transition to lower-emissions vehicles, and state-funded subsidies for Chinese EVs are causing concern for US and EU producers.

In April, global legislation on plastic pollution drew a step nearer, while a study showed the extent to which nature degradation could damage the UK economy. Although concerns remain about housing and grocery prices in the US, Fed officials still anticipate three quarter-point cuts during the year.

Greenbank have recently joined the Business Coalition for a Global Plastics Treaty and signed the Finance Statement on Plastic Pollution, signalling our support for an international legally binding agreement to end plastic pollution. This follows our earlier engagement on the issue, collaborating with the Ellen MacArthur Foundation and as an endorser of the New Plastics Economy Global Commitment.

In this annual Engagement Review, we provide a snapshot of our activities in 2023 and outline our focus areas as we continue our work in 2024.

As Q1 ended and data from major economies suggested increasing overall resilience, equity markets posted solid monthly returns. Europe’s flagship Nature Restoration Law faced mounting pressures, the UK National Standards Body launched a consultation for a framework of overarching principles for UK nature markets, and the Council of the European Union finally voted through an agreed text for the Corporate Sustainability Due Diligence Directive.

A good month for most global equity markets. In the UK the mandatory Biodiversity Net Gain measure for developers aims for 10% net gain in biodiversity or habitat on new developments, and there’s good news about the UK net zero economy and the global adoption of TNFD reporting.

Natural navigators learn to read the sun, moon, stars, weather, land, sea, plant and animals. In his latest book, How to Read a Tree, Tristan explains the simple principles that explain the shapes and patterns you can see in trees and what they mean.