Leading up to the UN Climate Summit, COP26, a major group of 587 investors, representing $46 trillion in assets, has issued a call on global governments to implement a set of actions geared towards helping mobilize investments to address the climate crisis, including outlining roadmaps to decarbonize emissions-intensive sectors and implementing mandatory climate disclosures.
In a statement developed by The Investor Agenda, a collaboration of sustainable investment focused organizations,* the investors urge global leaders to raise their countries’ climate ambitions and implement policies. The statement explains that investors are seeking to decrease their climate risk exposure and invest in opportunities to benefit from the net zero transition, yet the ability to properly allocate the trillions of dollars needed to facilitate the global transformation is limited by the current state of government commitments.
In the statement, the investors said:
“Strong policies, in line with limiting global warming to no more than 1.5-degrees Celsius, can accelerate and scale up private capital flows towards the net-zero transition. Full implementation of the Paris Agreement will create significant investment opportunities in clean technologies, green infrastructure and other assets, products and services needed in this new economy.”
The investors set out five priority actions for governments. These include strengthening 2030 Nationally Determined Contributions (NDCs) to align with limiting warming to 1.5-degrees Celsius; committing to domestic mid-century net-zero emissions targets, including interim goals and decarbonization roadmaps for carbon-intensive sectors; implementing policies to deliver on climate targets, such as carbon pricing, phasing out thermal coal-powered electricity generation, and removing fossil fuel subsidies; ensuring that COVID-19 economic recovery plans support the transition to net-zero emissions, and; committing to implementing mandatory climate risk disclosure requirements aligned with TCFD recommendations.
The statement also highlights the opportunities for countries that implement the recommended targets and policies, and the dangers for those who lag:
“While we recognize the differentiated responsibilities and respective capabilities of countries, we believe that those who set ambitious targets in line with achieving net-zero emissions, and implement consistent national climate policies in the short-to-medium term, will become increasingly attractive investment destinations. Countries that fail to do so will find themselves at a competitive disadvantage.”
Click here to view the investor statement and for a complete list of signatories.
*The Investor Agenda was founded in 2018 by the Asia Investor Group on Climate Change, CDP, Ceres, Investor Group on Climate Change, Institutional Investors Group on Climate Change, Principles for Responsible Investment and UNEP Finance Initiative.