More than 250 of the world's leading investors have issued an impassioned plea for policy action ahead of the UN climate talks this month, warning that inaction will risk economic disruptions "far more severe" than the global financial crisis.
A statement signed by 259 investors representing more than $15 trillion in assets, including heavyweights HSBC, Allianz, Deutsche Bank and Swiss Re, called on UN negotiators and the new US Congress to implement national and international strategies to foster private sector investment in the low-carbon economy.
At the Cancún climate talks, the group is hoping for progress in a number of areas, including emissions reduction targets, climate finance architecture, fast-start funding delivery and climate change adaptation.
The investors also hope the talks will deliver progress on a rapid timeframe for implementation of efforts to reduce emissions from deforestation and forest degradation and for the expansion of the international carbon market. Investors called for greater clarity on the future of the UN carbon offset mechanisms, the Clean Development Mechanism and Joint Implementation, and emerging crediting mechanisms such as Nationally Appropriate Mitigation Actions.
The statement said, without action, the impacts of climate change could cost up to 20% of GDP by 2050.
Jack Ehnes, chief executive of the $442 billion pension fund California State Teachers' Retirement System called for climate change to be tackled and private investment for low-carbon technologies catalysed, adding that the risks of inaction are "potentially catastrophic".
"Climate change if left unchecked threatens economic disruption exponentially more serious than the recent financial meltdown," he said.
Ole Beier Sørensen, head of research and strategy at the Danish pension fund ATP and chairman of the Institutional Investor Group on Climate Change, said "strong, stable, transparent policy" is the single most important driver for private sector investment in climate change solutions.
While policies in China and Europe are encouraging private sector investment in climate-relevant technologies, he said comparable economies such as the US risk being left behind because of a lack of policy drive.
Timothy Wirth, UN Foundation president and former US politician, said the US is "alarmingly absent" from climate initiatives and challenged the lack of long-term policy framework for low-carbon investment.
"The blunt fact of the matter is that our federal government is absent. We've got states like California moving aggressively but we have to spread that out across the country if in fact we're going to take advantage of this opportunity," he said.
By. Charlotte Dudley
Source: Environmental Finance
Charlotte is a writer for Environmental Finance.Environmental Finance is the leading global publication covering the ever-increasing impact of environmental issues on the lending, insurance, investment… More
Comments