Fulfil promises to developing world, $39trn investor coalition tells governments

Assets signed up to annual investor statement to governments on the climate crisis fall against 2021, State Street drops support.

A $39 trillion coalition of institutional investors has called on world governments to scale up the provision of climate finance for climate mitigation, adaptation and resilience, with a particular focus on the needs of developing companies, “building on the agreed outcomes of COP26”.

A total of 532 investors signed the Global Investor Statement to Governments on the Climate Crisis, which also calls on policymakers to align their 2030 nationally determined contribution (NDC) targets for climate mitigation with 1.5C, support the implementation of the Global Methane Pledge, and strengthen climate disclosures through mandating TCFD reporting, requiring published transition plans and driving global consistency across climate risk disclosure and prudential risk supervision.

The statement was co-ordinated by the Investor Agenda, a collaboration between seven investor groups including the PRI and UNEP FI, which described it as the most ambitious statement yet in terms of policy recommendations. The proposals are significantly more detailed than the 2021 investor statement, which called on governments to commit to a “mid-century” net-zero target and ensure covid-19 recovery plans supported the net-zero transition.

The investor signatories further “encourage governments to engage closely with investors to make sure [climate] risks are effectively managed and that these opportunities are fully realised”.

The signatory list includes large asset managers and owners such as LGIM, UBS Asset Management, CalPERS, and both New York State and City pension funds.

BlackRock is absent, although it has tended not to sign on to other joint statements, as is State Street, which signed the statement last year. State Street declined to comment on its absence from the list.

Investors will be able to sign the statement until November, when COP27 gets underway in Sharm El-Sheikh. At this point last year, the statement had gathered 587 signatory firms representing $46 trillion in assets. The final total was $52 trillion.

A spokesperson for the Investor Agenda said: “The current iteration of the Global Investor Statement is reflective of our most ambitious approach to date. Despite a comparatively lower cumulative AUM among investor signatories compared to last year, we believe the statement is reflective of the appropriate level of ambition in its calls to governments, and we encourage all investors to lend their voice to the statement.

“Doing so helps to underline to lawmakers that investors cannot tackle the climate challenge alone, they need appropriate public policy support.”

Will Martindale, co-head of sustainability at £50 billion ($58 billion; €57.6 billion) investment and advisory group Cardano, said that having the relevant data and information was vital for decarbonising the firm’s portfolio.

“Currently one of the key challenges, particularly in the context of emerging markets, is that relevant information, such as corporate emissions data, is often weak or missing entirely,” he said. “This can be attributed to a number of factors, including a lack of mandatory disclosure requirements. This is why we are calling on all governments and policymakers globally to raise the bar.”

Martindale added that it was vital for emerging markets to have access to capital to finance the transition. This is especially important, he said, for an equitable and fair transition, which is meaningful “when bearing in mind those in lower-income economies tend to be disproportionately impacted by climate change”.

In order for this capital to flow where it is needed, governments must provide investors with clear policy signals such as those set out in the investor statement, he added.