By any standard, the London meeting of finance ministers of the Group of Seven leading Western economies a week before the G7 leaders’ summit was historic. By committing to transformative structural change to meet net-zero greenhouse gas targets and other environmental objectives, G7 finance ministers turned themselves into adjuncts of their environment ministries. Considerations of climate change and biodiversity loss are to be embedded into economic decision-making, they pledged. Some form of carbon tax is heading America’s way, after Treasury secretary Janet Yellen signed a communiqué that commits to “the optimal use of the range of policy levers to price carbon.”
That’s for the future. More immediately, the London meeting agreed to make climate reporting by companies mandatory across the G7. Britain’s Chancellor of the Exchequer Rishi Sunak professed himself thrilled. “This is such an important step in getting markets to play their part in tackling environmental issues and paves the way for us all to achieve our net-zero goals,” he tweeted. The ostensible justification – which no doubt Gary Gensler, President Biden’s pick to chair the Securities and Exchange Commission, is already prepping – is to help investors better appraise climate risk.
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