Sir Keir Starmer standing at the podium outside Downing Street
16 Jul 2024

UK General Election Briefing – July 2024

Following on from the UK General Election on 4 July 2024, this policy briefing unpacks the key climate-related policy elements of the new government's manifesto.

As a result of the UK General Election on 4 July 2024, Sir Keir Starmer of the Labour Party has become UK Prime Minister. The Labour Party’s election campaign centred on its ‘Change’ Manifesto, which set out how “Labour’s first mission in government will be to grow [the UK] economy”. As the party takes office, focus now turns to how this ambition, alongside Labour’s other manifesto commitments, will be delivered.

Key climate policy takeaways

  • Energy policy is a central focus of the new government’s agenda, with notable commitments including the creation of a publicly owned clean energy company, provisionally entitled Great British Energy—aiming to reduce the UK’s reliance on fossil fuels and enable a zero-carbon electricity system by 2030. In upholding its commitment to meeting carbon budgets and targets, the new government faces a daunting challenge in terms of putting policies in place and implementing them in a timely fashion. There will be a need for significant private capital investment to realise the decarbonisation ambitions outlined in the manifesto.
  • Labour has committed to creating both an Industrial Strategy and ten-year Infrastructure Strategy, which are expected to offer clarity to businesses on key net zero industries and infrastructure programmes. NEDs will want to monitor these policies as they develop to assess the potential opportunities for business.
  • The Labour Manifesto contains an explicit mandate for UK-regulated financial institutions and FTSE 100 companies to develop and implement credible transition plans that align with the 1.5°C goal of the Paris Agreement. This marks a significant step forward from the FCA’s ‘comply or explain’ regulatory approach to climate disclosure, strengthening the expectations for net zero compliance, which is expected to have material impact on UK businesses’ governance practices.
  • This change in government offers an important opportunity for businesses to engage with newly elected government actors. Proactive policy engagement can help align the delivery of the new government’s net zero transition commitments and ambitions with the practicalities and priorities of the business community.

 

What we know so far about the new government’s climate-related objectives

The following sections outline a number of Labour’s key policy commitments according to its 2024 Manifesto.

Ways for businesses to engage

  • The King’s Speech, which marks the State Opening of Parliament, is on 17 July. Following that, there is likely to be clearer indication of Labour’s transition into government and the initial timelines for forthcoming policies. Businesses and their NEDs will want to stay up-to-date with developments, in order to understand the intersections between corporate strategy and government policymaking, and/or opportunities to bring these into better alignment.
  • Business-led engagement can have a positive influence on investment and public spending reform, whether in identifying new finance streams or better ways to spend existing budgets. This feeds into the business community’s capacity to inform central government priorities and trade-offs, helping shape the net zero economic opportunity as it presents itself – particularly in terms of policy delivery (national vs. local net zero delivery, for example). This coordination may help address the ambition gap between government policies and corporate commitments, holding the new government to account on its green policy commitments.
  • A major focus of this new Labour government is the ambition to “improve ethical standards in government”, and more active and transparent engagement with businesses could be a practical step forward in this regard.
  • There is existing guidance for NEDs looking to participate in responsible corporate engagement, including the Climate Governance Initiative and InfluenceMap’s work on corporate climate policy engagement, which provides a number of guiding questions board directors could be asking, including:
    • What climate policy engagement has taken place and/or is planned by the company?
    • Are existing policy positions consistent with a climate transition strategy that is aligned with net zero by 2050?
    • Has the board mapped all the different channels of influence through which the company seeks to engage on climate policy (e.g. through academia and civil society, via social media, PR, advertising and sponsorship of research)?
    • Does the company regularly monitor the policy positions of its membership organisations to ensure alignment? What actions does it take if and when it spots inconsistencies, and how is the board kept informed? Is there an ongoing process of review?
    • What disclosures does the company make regarding its individual climate policy engagement, its alignment with industry associations, and any remedial actions taken to address potential inconsistencies between the two?
  • There are a number of expected consultations that will inform the net zero policy approach of the new government, for which a diverse business perspective would be valuable. NEDs may be in a position to help facilitate their businesses’ contributions to these consultations, which can be found on the government website as they are announced.

Looking ahead

  • The King's Speech will take place on 17th July 2024. We expect further details on the new government's climate policy and implementation plan to be included within the speech. Please keep a lookout on our LinkedIn feed for updates.
  • In September 2024, we will release a full quarterly policy update.
This content has been created by the Centre for Climate Engagement in collaboration with Chapter Zero.

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