More than 340 global institutional investors representing over $24 trillion in assets worldwide have issued a statement calling on governments to create a platform for consistent, economically relevant and dependable carbon pricing. This appeal has set the stage for the UN Climate Summit that is about to convene to facilitate a global climate agreement in 2015, according to the United Nations Environment Program (UNEP).
Stable and economically meaningful carbon pricing will help channel investments in the right direction to match up to the huge climate change challenge, as well as allow for faster development of plans to phase out subsidies for fossil fuels worldwide. The statement says that gaps, weaknesses and delays in clean energy policies and climate action will only increase the risks to their investments and lead to a likelihood of more radical policy measures being required to cut down carbon emissions.
The statement by global investors is the largest of its kind on climate change, and emphasizes on the need for a more decisive political leadership and more ambitious policies to help a scaling up of investments. The International Energy Agency (IEA) says that the world needs to invest an additional $1 trillion every year – a Clean Trillion – into clean energy by 2050, if we nurture any hope of limiting global warming to 2 degrees Celsius. However, the reality is that global investment in clean energy was only $254 billion in 2013.
The statement by leading global institutional investors was coordinated by the four investor groups on climate change – Ceres’ Investor Network on Climate Risk (INCR) in the United States, the European Institutional Investors Group on Climate Change (IIGCC), the Investors Group on Climate Change (IGCC) in Australia and New Zealand, and the Asia Investor Group on Climate Change (AIGCC) – with the United Nations Environment Programme Finance Initiative (UNEP FI) and Principles for Responsible Investment (PRI).
Ceres president, Mindy Lubber, said that it is an important development that the world’s largest institutional investors are in agreement that climate change challenges put their investments at risk. The global financial community has given a clear message for the heads of state gathering at the UN next week that the world cannot afford to wait any longer for a climate deal.
Source: Insurance Newsnet
Image Credit: Flickr via NASA Goddard Photo and Video
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