Big business, investors urge tough climate action
Investors controlling tens of trillions of dollars have asked policymakers to write better and clearer rules, in order to enable the transition to a low carbon economy.
They have signed a statement entitled Investment Grade Climate-Change Policy, which was commissioned by three global Institutional Investors Groups and the United Nations Environment Programme Finance Initiative.
This statement provides an excellent check-list for policymakers (and their observers or advisors) and highlights the importance of policy risk minimization in attracting investment capital. Concrete examples of six national policy frameworks around the globe are also analyzed.
The policy recommendations include: clear, enforceable domestic greenhouse gas emission reduction targets and timelines; transparent and comprehensive policies to meet these targets; a price on carbon and removal of fossil fuel subsidies; clear criteria for any change in policy, to avoid surprises; and support for a binding international treaty on carbon pricing and greenhouse gas emission reductions.
Signatories to this statement include British Columbia Investment Management Corporation, British Columbia Teachers Federation and Vancity Investment Management Ltd.
The big five Canadian banks have not yet added their names. British Columbia has implemented many of the policies recommended by the group, through the Greenhouse Gas Reduction and Carbon Tax Acts, and through membership of the Western Climate Initiative.
In two months, British Columbia will join its partner provinces and states (including California) in the initiative's cap and trade market. Although recent policy statements from provincial leadership have focused on infrastructure investments to help fossil fuel industries, BC should also remind global investors of its clear emission targets and carbon pricing.