Investors must show leadership on climate change

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COPENHAGEN, 24 May 2009 - Global investors today urged the international community to ensure the policy response to climate change is systemic, timely and adequate to the task.

At a dinner with UN Secretary General Ban Ki Moon, the UN-backed Principles for Responsible Investment Initiative (PRI) launched a paper that acknowledged ‘business as usual’ from investors was not enough in the face of the economic threat from climate change.

The PRI report said investors must show leadership in four specific areas, and highlighted examples of best practice from the responsible investment sector that all mainstream investors could emulate. It argued a particular responsibility fell to large pension funds which have long-term investment horizons and diverse investments across the economy.

The four areas detailed by the report for global investors to act in were:

  1. allocating capital to low carbon opportunities
  2. building climate change factors into investment processes
  3.  engaging as shareholders to improve company performance and disclosure on climate change
  4. working collaboratively with policymakers on international climate policy. The PRI report was published as part of the wider ‘Caring for Climate Initiative’ instigated by the UN Global Compact.

James Gifford, Executive Director of the PRI stated,

“The role of investors should not be underestimated in addressing the climate challenge. As providers of capital and owners of companies they have a duty and an opportunity to act against climate change and protect the long-term value of their portfolios.

“The multilateral governmental process does not happen in a vacuum. Investors are an important stakeholder, and they need to participate in these public policy processes to ensure their views are taken into consideration”.

The Principles for Responsible Investment (PRI)

The Principles for Responsible Investment, convened by UNEP FI and the UN Global Compact, was established as a framework to help investors achieve better long-term investment returns and sustainable markets through better analysis of environmental, social and governance issues in investment process and the exercise of responsible ownership practices. The Principles themselves, a full list of signatories and more information can be found at www.unpri.org

UN Global Compact

Launched in 2000, the UN Global Compact brings business together with UN agencies, labour, civil society and governments to advance ten universal principles in the areas of human rights, labour, environment and anti-corruption. Through the power of collective action, the Global Compact seeks to mainstream these ten principles in business activities around the world and to catalyze actions in support of broader UN goals. With more than 5000 participating businesses from over 130 countries, it is the world’s largest voluntary corporate sustainability initiative. More at: www.unglobalcompact.org

United Nations Environment Programme Finance Initiative (UNEP FI)

UNEP FI is a unique public-private partnership between UNEP and the global financial sector. UNEP works with over 170 banks, insurers and investment firms, and a range of partner organisations, to develop and promote linkages between sustainability and financial performance. Through its comprehensive work programme encompassing research, training, events and regional activities, UNEP FI carries out its mission to identify, promote and realise the adoption of best environmental and sustainability practice at all levels of financial institution operations. More information: www.unepfi.org