Global Policy Advocacy | The Investor Agenda

Overview

Investors are a key influence on policymakers and, therefore, to their beneficiaries.

Public policy is a key ingredient in defining the rules by which capital markets operate. It signals and incentivizes the flow of capital across the global economy, particularly where the benefits of investment accrue not to one market actor but across the global economy and society. Policymakers need to create policy frameworks that support investment in low-carbon assets, enable investment in adaptation measures, and enact a just transition for affected workers and communities. They also should ensure that investors take full account of the risks and opportunities presented by climate change in their decision-making.

2024 Global Investor Statement

Effective policies are essential at all levels of government to accelerate the private capital flows needed for a climate-resilient, nature-positive, just net zero transition. That’s why, the Founding Partners of The Investor Agenda are facilitating the 2024 Global Investor Statement to Governments on the Climate Crisis, the most comprehensive yet.

The Statement calls for a whole-of government approach to implement 5 critical policies in line with countries’ nationally-determined contributions (NDCs) and a 1.5°C scenario, recognizing common but differentiated responsibilities and respective capabilities between emerging and developed economies, that will accelerate private sector action and large-scale investment.

Read the 2024 statement

The Changing Climate Policy Landscape

Public policy shapes the decisions made by investors and by companies on where they allocate and where they do not allocate capital. Public policy also shapes the terms on which capital is allocated, including factors such as the cost of capital, the risk premia that are applied, the security or collateral that is needed, the duration of the investment, and the target returns.

Private capital has a critical role to play if we are to successfully transition to a low carbon economy and respond effectively to unavoidable physical climate change. It has therefore been a focus of international, regional and domestic monetary and fiscal policy and this has catalyzed significant growth in climate finance flows over the past decade.

The level of ambition in public policy has grown dramatically in recent years. The US Inflation Reduction Act is perhaps the most high-profile example of this trend. Similar industrial policy programs include the European Union’s Fit for 55 and RePowerEU plans, while Japan has launched the Green Transformation (GX) and China, the 1+N policy framework.

The Founding Partners of the Investor Agenda have published a report which analyses how investors are responding to this new generation of policy interventions, suggesting that good climate policy frameworks, i.e. policy that enables and accelerates the investment needed to meet the goals of the Paris Agreement, is underpinned by eight key features:

Clear Commitments to Action,
Clear Short-, Medium- and Long-term Targets,
Comprehensive and At Scale,
Sector-specific Policies,
Provide the Right Incentives,
Just Transition,
Transparency, and
Transition Planning.

Find out more and read the full policy report here

Overview

2024 Global Investor Statement

The Changing Climate Policy Landscape

Translations