More than 450 investor, company and capital market leaders convened at the Investor Summit on Climate Risk last week to map out the next steps for increased action on climate change. The strong showing of leaders, ranging from institutional investors to state and city pension fund fiduciaries and corporate executives, demonstrated the growing mainstream attention to one of the world’s most pressing problems.
“It is encouraging to see investors from around the world stepping up like never before to align their investments with the market opportunities created by the Paris Agreement and the low-carbon transitions,” said Mindy Lubber, CEO and President of Ceres.
In the day’s opening remarks, Lubber issued a call to action, urging investors to scale up and accelerate action on climate change. “Investors must address the risks and seize the opportunities of climate change by increasing new investments in low-carbon technologies, including energy efficiency, and reducing investments in high-risk, high-carbon fossil fuels, such as coal,” Lubber said.
To guide investors in this effort, a diverse group of investors and seven partner organizations who work with more than 1800 institutional investors combined — 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 — joined forces to debut The Investor Agenda at the Summit. The agenda identifies actions that investors can take right now in four key focus areas: investment, corporate engagement, investor disclosure and policy advocacy.
“As investors, we must raise our voice and make sure lawmakers understand the business case for clean energy and reduced emissions — on both a state and federal level,” said Jack Ehnes, CEO of CalSTRS. “This is not just a nice-to-have, it’s a necessary extension of investors’ responsibility and fiduciary duty to act in the interests of their beneficiaries.”
The Agenda’s release comes as 256 investors with nearly $28 trillion in assets under management have now signed on to Climate Action 100+. Launched in late 2017, this global initiative aims to engage with the world’s largest corporate greenhouse gas emitters on climate change and is a keystone initiative in The Investor Agenda.
“The influential and growing group of investors who have signed on to Climate Action 100+ is signaling a powerful commitment to scaling up climate action,” said Betty T. Yee, California State Controller. “We hope many more investors will join us in this meaningful engagement with companies to help achieve the goals of the Paris Agreement.”
During the Summit, influential U.S. investors announced commitments to low-carbon investments. Notably, New York State Comptroller Thomas P. DiNapoli announced that the New York State Common Retirement Fund is putting an additional $2 billion into its ow-emissions equities index, raising the fund’s sustainable investments portfolio to $7 billion.
“As investors committed to building a lower carbon economy, we know the future holds enormous opportunities, even as it presents risks,” DiNapoli said. “Our call is for all investors to join in the global effort to rein in global warming through smart choices that put a premium on sustainability.”
The rollout of The Investor Agenda adds to a surge of actions from large, mainstream global investors, who are stepping up like never before to seize the economic benefits that climate action offers. La Caisse de dépôt et placement du Québec (CDPQ), Canada’s second-largest pension fund, recently committed to increasing its low-carbon investments by 50 percent by 2020, representing more than $8 billion in new investment. And, in Europe, AXA, the world’s largest insurer, set a target to reach $14.7 billion in low-carbon investments by 2020.
The Investor Summit on Climate Risk is a biennial convening co-hosted by Ceres, United Nations Foundation and the United Nations Office for Partnerships. 2018 marks the eighth time these three organizations have convened leading global investor, company and other capital market leaders.