‘Woke’ banknotes: Bank of England orders money printer to follow ESG rules
The Bank of England is facing backlash over its plans to make a new banknote printer comply with ESG and diversity standards under a “pass or fail” regime.
Bank officials have attracted criticism from shadow business secretary Andrew Griffith over their plans to make applicants for the UK’s new money printing contract follow stringent criteria on areas including sustainability and equality.
The Bank has issued a contract tender for supplying banknotes from 2028 over a period of 10 years as the current deal with paper manufacturer De La Rue is set to expire.
Under the terms of the £900m contract, applicants are required to follow key conditions on ESG, equality and diversity and carbon reduction.
Applicants will be assessed on a pass or fail basis, with a deadline for bidders to come late next month.
Griffith, who stood in for Tory leader Kemi Badenoch during PMQs on Wednesday, hit out at Threadneedle Street for prioritising sustainability issues in bidding rounds.
“When the UK economy is expected to grow slower than Greece, Albania or Mexico this year, the Bank of England shouldn’t be worrying about finding a ‘woke‘ banknote printer but instead helping grow our financial sector,” Griffith told CityAM.
Bank of England under fire
A Bank of England spokesperson said legislation on procurement allowed “set conditions of participation” for suppliers hoping to be awarded the lucrative contract.
“Details of these conditions and how they are to be assessed will be shared with applicants in due course,” the spokesperson added.
Environmental, social and governance standards and diversity rules have come under more intense scrutiny across the City in recent years given concerns about the UK economy’s low growth, financial services firms’ abandonment of net zero groups and President Trump’s staunch opposition to climate frameworks and diversity campaigns.
Barclays and HSBC quit a net zero-focused banking group last year while surveys have shown finance professionals taking less interest in championing diversity, equality and inclusion commitments.
A report by the think tank Policy Exchange last year also found that the value of listed firms that had gained approval from ESG ratings providers fell by twice as much as the FTSE 100 in 2024.
A separate report by the Institute of Economics Affairs said diversity initiatives led by the Financial Conduct Authority (FCA) and other public bodies had gone “far beyond” remits set by legal requirements.
Callum Price, director of communications at the Institute of Economic Affairs said: “All government bodies, the Bank of England included, should only be concerned with doing the job that they have been created to do to the best of their ability. This means keeping costs down as much as possible and resisting mission creep.
“Tying unnecessary baubles onto the requirements for procured contracts that do not affect the primary role of the contract will only drive up costs, increase inefficiency, and reduce competition.”