Some of the world’s biggest institutional investors representing $13 trillion in assets have vented their frustration at the lack of progress at the recent Copenhagen summit by telling individual countries that they will invest money in those markets that go it alone with strong climate change policies. The investor statement was announced at the Investor Summit on Climate Risk, a meeting of 450 global investors at the United Nations that included UN Secretary General Ban Ki-Moon, United States Special Envoy for Climate Change Todd Stern, billionaire investor George Soros and former Vice President Al Gore. In the statement, the US, European and Australian climate investor groups said: “We cannot wait for a global treaty”. They called on the US Congress and other global decision-makers “to take rapid action” on carbon emission limits, energy efficiency, renewable energy, financing mechanisms and other policies that will accelerate clean energy investment and job creation. The investors argue that there are competitive advantages for countries with comprehensive climate and energy policies. They point out that private-sector investors will likely be responsible for financing more than 85% of the global transition to a low-carbon economy.
Anne Stausboll, chief executive officer of the $205 billion California Public Employees Retirement System (CalPERS), said: “Investors are poised and ready to scaleup investments in building the low carbon economy, but without policies that create a stable investment environment our hands are tied. US leadership is critical in this regard, including Senate action to limit and put a price on carbon emissions.” To catalyse investment in their countries, the investors listed policies they said national governments should immediately adopt or support. These were:
- Short- and long-term carbon emission reduction targets.
- An effective price on carbon emissions that helps shift investment towards low-carbon solutions.
- Energy and transportation measures to vastly accelerate deployment of energy efficiency, renewable energy and clean vehicles and fuels.
- New financing mechanisms that can mobilize private-sector investment on a large scale, especially in developing countries.
- Measures and financing to support climate-related adaptation in developed and developing countries.
- Requirements for full corporate disclosure of material climate-related risks and strategies to manage those risks.
The Investor Statement on Catalyzing Investment in a Low-Carbon Economy was endorsed by four groups representing more than 190 investors: the Investor Network on Climate Risk (INCR – US), Institutional Investors Group on Climate Change (IIGCC – Europe), Investor Group on Climate Change (IGCC – Australia) and the United Nations Environment Programme Finance Initiative (UNEP FI). Peter Dunscombe, chairman of the IIGCC and head of investments at the BBC pension fund:“Given that Copenhagen was a missed opportunity to create one fully functional international carbon market, it is more important than ever that individual governments implement regional and domestic policy change to stimulate the creation of a low carbon economy. Time is of the essence and world leaders from both developed and developing countries need to act now to compensate for the lack of progress at an international level.”
Link to statement