Labour is launching an inquiry into “shadow banking” in a bid to crack down on investment that fuels industries contributing to climate change.
Shadow chancellor John McDonnell announced the the investigation in a speech to UK Finance on Monday as he talked up Labour’s green credentials.
McDonnell praised the actions of the Extinction Rebellion protestors who brought parts of London to a standstill in April as they sought to highlight the impact of climate change.
In his speech, McDonnell said a Labour government would intervene in the financial sector to stop institutions from “actively contributing to planetary heating or exposing our economy to financial instability.”
He added: “Today I am launching an independent inquiry into the role and activities of shadow banking in our economy to examine what state intervention may be required to increase the transparency and accountability of this sector to ensure it plays its full role in addressing the climate change emergency that we face.”
McDonnell said the review would cover commercial banks, investment banks, pension funds, hedge funds, private equity, asset managers, derivatives and securities traders and exchanges, and any other aspect of the finance sector of relevance.