This was a week in which a Manchester man not receiving a Chinese takeaway hit the headlines.

So it is pretty shocking that the first recommendations from UK’s Green Technical Advisory Group (GTAG) to the Government on how to develop a green taxonomy that will have a direct bearing on future sustainable development and transformation barely registered on the media radar.

GTAG has been tasked with supervising the creation of a UK version of the European Union’s equivalent taxonomy, now that - and here’s a story you may have heard of - the UK is no longer part of the EU. Its initial recommendations are that the UK approach is at least as stringent as that hammered out in Brussels.

While it would have to differ from the EU stipulations in places to reflect local laws, the UK taxonomy would have to be broadly similar to avoid “extra costs and disincentives for international investors in the UK”, GTAG warned in putting its case forward.

Bloomberg’s take on the story was that the UK’s rules should not be a carbon copy, but did outline the call for the UK to follow the path of the EU taxonomy “as a general template”.

Beyond that, there has been practically zero mainstream media coverage of this initial move by the independent group appointed by the Government last summer to both review the UK’s approach to oversee the delivery of the UK’s rules and help to tackle greenwashing. Which is a little strange, given the growing storyline about whether the Government intends to soften environmental rules to spur growth, which the Chancellor has denied.

If the UK’s taxonomy does turn out to be largely the same as the EU one, barring some legal technicalities, it will likely only increase the need for its definitions to be absolutely crystal clear for investors, to ensure that it is practical and sufficiently specific for decision-making.

On the reporting side, while the EU is moving ahead with ESG disclosure standards, the Financial Conduct Authority in the UK has outlined a more specific route, having already published “indicative mapping” that suggests ESG investment categories will be badged as ‘responsible, sustainable-transitioning, sustainable-aligned and sustainable-impact’. With requisite laser definition, no doubt.

In the world beyond the politics of ensuring clarity, according to a PwC story this week, demand for ESG investments is now outstripping supply and funds are set to hit $34 trillion by 2026. This is despite managers being hesitant in launching any new investment funds, and $1 billion being whipped away from BlackRock (OK, fairly small change compared to $34 trillion).

As this all settles into place, and the implications for business become clearer, the nearer-term question is the balance of priorities as companies navigate increasingly choppy economic waters. According to a KPMG survey of CEOs this week, while 69% had seen a significant demand for greater ESG reporting in the past year, 86% saw a recession happening within 12 months.

But 45% of the worldwide group also believed the next year would see ambition to drive sustainable change increase to support momentum towards long-term goals, despite the economic pinch. As storm preparations are made but one eye remains on when the clouds do part, those UK definitions will surely become more eagerly anticipated.

At least that’s my takeaway.

The ESG News Review is written by Steve Earl, a Partner at BOLDT. 

Subscribe to our weekly ESG related stories by completing the form below.