Join the 457 investors with US$41 trillion in assets calling on governments to step up their collective response to the climate crisisPosted 12th July 2021
As the climate crisis worsens, the urgency to accelerate collective action continues to increase.
The International Energy Agency just reported that if investment in renewables continues at the level of the last four years the world will remain off-track for achieving the target of a net zero emissions economy by 2050 or sooner. Progress has been uneven and the COVID-19 pandemic has layered global health and economic crises on top of the climate crisis. Investment in a green recovery must happen on a consistent basis across the globe.
The next decade will be vital for governments to strengthen their response to the climate crisis at speed and scale. Decisive action today will allow more ambitious targets to be met in 2030, which can put the world on a path to a net zero emissions economy by 2050 or sooner. A weak response, however, will make the task much greater in the years to come.
That is why institutional investors worldwide have come together for the strongest-ever investor call to governments to raise their climate ambition and implement strong climate policies.
In a statement signed to date by 457 investors from 30 different countries with over $US41 trillion of assets, signatories are urging swift government action ahead of the 26th United Nations Climate Change Conference of the Parties (COP26).
Specifically, investors are calling on governments to:
- Strengthen their Nationally Determined Contributions for 2030 – limiting warming to 1.5°C
- Commit to a mid-century net-zero emissions target with clear sectoral decarbonization roadmaps
- Implement domestic policies to deliver these targets, incentivize private investments in zero-emissions solutions and ensure ambitious pre-2030 action
- Ensure COVID-19 economic recovery plans support the transition to net-zero emissions
- Commit to implementing mandatory climate risk disclosure requirements
Signatories so far collectively manage an estimated 37 per cent of all global assets and include some of the world’s largest institutional investors and asset managers such as AustralianSuper, CalPERS, HSBC Asset Management, Legal and General Investment Management, M&G, Nomura Asset Management, and State Street Global Advisors (see full list of signatories here). This unprecedented support represents the largest collective assets under management to sign on to a global investor statement to governments on climate change since the first statement was released in 2009.
The 2021 Global Investor Statement to Governments on the Climate Crisis was coordinated by the founding partners of the Investor Agenda: AIGCC, CDP, Ceres, IGCC, IIGCC, PRI and UNEP FI.
The good news is several major economies have already been showing signs of increased climate ambition and policy momentum, if still having a way to go to be fully aligned with the goals of the Paris Agreement. To name just two recent examples: the Biden administration has announced that the U.S. is targeting 50-52 per cent reduction from 2005 levels in economy-wide net greenhouse gas pollution in 2030 and Japan is targeting 46-50 per cent below 2013 by 2030.
The overall pace of government response to the climate crisis, however, is currently not sufficient to meet the goals of the Paris Agreement. As a result, more investors are now speaking up and using their influential voices to call for even bolder and faster policy action.
The support for the statement is a positive sign of the increasing investor participation in climate policy advocacy. The statement remains open for further investor signatures in the lead up to COP26 this November.
It comes following the release of the Investor Agenda Investor Climate Action Plans (ICAPs) Expectations Ladder and Guidance, which sets clear expectations for investor action on climate change. Alongside investment, corporate engagement and investor disclosure, the ICAPs Expectations call on investors to engage with policymakers as a critical way for investors to help achieve a just transition to a climate-resilient, net zero economy by 2050 or sooner.
Indeed, the 2021 Global Investor Statement to Governments on the Climate Crisis highlights how all of these aspects are linked. For example, those countries which are progressive on climate policy – e.g. by implementing mandatory climate risk disclosure and building decarbonisation into COVID-19 economic recovery – will attract the largest capital flows towards the net-zero transition. In turn, investors can use capital allocation and stewardship to support sustainable activities that generate jobs and economic growth, shift away from carbon-intensive activities and increase resilience.
New York State Comptroller Thomas P. DiNapoli said: “As the world prepares for COP26, investors are committing to net-zero portfolios and persuading corporations to take action and accelerate achievement of the Paris goals. Governments must be a partner in these efforts. By enacting policies that incentivize the transition to a climate resilient, net zero emissions economy, governments around the world can create a path toward a better future that helps businesses prosper, creates new jobs and expands investment opportunities in climate solutions.”
Michelle Scrimgeour, Chief Executive Officer, Legal & General Investment Management, said: “Climate change is one of the greatest systemic risks we face today and achieving net zero by 2050 will be crucial to help steer the world towards a more sustainable future. We will need to see substantial change across industry and society globally to achieve this goal. As long term investors we play a pivotal role, not only in decarbonising investment products on behalf of our clients but also influencing the real economy transition by engaging with and holding businesses accountable on their net zero transition plans.
“As co-chair of the UK Government’s COP26 Business Leaders Group, I am encouraged by the progress we are already making, though there is still much to be done and we all need to play our part. Inaction is simply not an option.”
HESTA Chief Executive Officer, Debby Blakey, said: “In Australia, we have an incredible opportunity to attract global investment and draw on the more than $AUD3 trillion pool of superannuation savings to power a low-carbon transition. But investors need greater certainty provided by stable, long-term policy settings. If we can get a clear, timely path to net zero, then superannuation funds like HESTA would have a significant appetite to invest more in domestic renewable infrastructure and innovative cleantech opportunities.”
Calling all institutional investors to sign the 2021 Global Investor Statement to Governments on the Climate Crisis !
The statement remains open to new investor signatories. We invite investors to add their name to this statement and to tell governments to take ambitious climate action now.
Sign here today! The statement will close in advance of the COP26 taking place on 1st – 12th November 2021.
About The Investor Agenda
The Investor Agenda is a common leadership agenda on the climate crisis that is unifying, comprehensive, and focused on accelerating investor action for a net-zero emissions economy. The founding partners of The Investor Agenda are seven major groups working with investors: 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. For more information, visit theinvestoragenda.org and follow @InvestorAgenda.
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