The green ‘emerging global contender’

06 September 2018

Written by Dr Andy Sloan

Guernsey’s core funds messages have been given a global boost with the publication of a new report on Guernsey Fund Services, produced with Global Fund Media. The report identifies Guernsey as a leading jurisdiction for both start-up managers and established funds. Here, Guernsey Finance Deputy Chief Executive, Strategy, Dr Andy Sloan discusses Guernsey’s green finance credentials.

Guernsey has been identified as an ‘emerging global contender’ in green finance. In a climate currently led by the global commitments made at the United Nations COP 21 conference in 2015, Guernsey has identified green issues as a key strategic objective.

The island is rapidly becoming the “go to” international finance centre for green finance. The introduction by the regulator, the Guernsey Financial Services Commission, of the world’s first regulated green fund product, the “Guernsey Green Fund” puts us at the forefront of green finance development.

The objective of the GGF is to provide a platform upon which investments into various green initiatives can be made. The GGF will enhance investor access to the green investment space by providing a trusted and transparent product contributing to the internationally-agreed objectives of COP21, the 2015 United Nations Climate Change Conference, and provides certainty, consistency and simplicity for investors.

Investors in a GGF will be able to rely on the GGF designation, provided through compliance with GGF rules, to represent a scheme that meets strict eligibility criteria of green investing and will have the objective of a net positive outcome on the planet. 

The island already has a number of cleantech funds established, and although the sector is growing, green funds are still at an embryonic stage. Investors are often hesitant to invest in funds which may not ring true to their green label, or do not want to sacrifice a good return for the sake of their environment.

The GGF rules use standards developed by international financial institutions with the appropriate scientific background to ensure that the various assets held in a GGF are green within the true meaning of the word.

Any type of fund can apply to be a Guernsey Green Fund, and under the guiding rules and principles, will have to invest in themes such as renewable energy, lower carbon and efficient energy generation, energy efficiency, agriculture and forestry, waste and waste water and transport.

Guernsey’s trend-setting progress so far has been welcomed by Michael Mainelli, chairman and co-founder of the think tank Z/Yen, which has listed Guernsey as an ‘emerging global contender’ in its inaugural Green Global Finance Centres Index.

“I am extremely encouraged to hear about Guernsey bringing out green fund regulation,” he said on the pro-sustainability podcast Planet Pod. “We are seeing regulators begin to pay attention and I hope that’s picked up.”

An original version of this article first appeared in The Global Fund Media special report on Guernsey fund services, July 2018. Click here to access the full report.

Download Find a related practitioner