Investors continue to adopt new targets and strategies for pursuing net-zero emissions by 2050 and investing in climate solutions, according to a new report released today by the Investor Group on Climate Change (IGCC).

The new report – Zero Emissions/Sustainable Returns – is a practical guide for investors on strategies to pursue net-zero emissions portfolios while ensuring sustainable returns.

The report details current investor thinking, real-world examples of how investors are transitioning to net-zero emissions and the overall state of play in investor practice. It is intended to support investor ambition and accelerate practical action on setting net-zero investment strategies.

Read the full Media Release

Download the Report

Australia can boost its climate change resilience and accelerate emissions reductions with policies that unlock private capital, the Investor Group on Climate Change (IGCC) said in response to Prime Minister Scott Morrison’s address to the National Press Club.

IGCC Chief Executive Officer, Emma Herd, said Australia needed prudent management of climate risks that would reduce the financial, economic and community costs of climate change. This includes physical risks, such as worsening drought and fires, and the economic risk of a disorderly shift to net-zero emissions.

“Investors are already making decisions on whether or not to deploy capital in Australia on the basis of their own climate change risk assessments,” Ms Herd said.

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Six leading organisations representing Victorian workers, business, investors, community and the environment have joined forces for the first time to call for decisive and responsible Victorian Government action on climate change.

The Victorian Chamber of Commerce and Industry, Australian Industry Group, the Investor Group on Climate Change, Victorian Trades Hall Council, the Victorian Council of Social Service and Environment Victoria developed the statement, urging the Victorian Government to reduce emissions and implement a plan to transition to a low-carbon economy.

The organisations call on the Victorian Government to:• Set emissions reduction targets in line with Victoria’s equitable share of the global emissions reduction challenge set by the objectives of the Paris agreement (to keep warming well below two degrees and pursue efforts to keep warming to 1.5 degrees), and the achievement of net zero emissions by 2050;
• Establish an independent authority to guide planning and implementation of equitable climate transition policies, including fair transition for workers and industries, households, and communities facing the greatest risk;
• Assist industries and communities to adapt to the consequences of climate change; and
• Coordinate with other jurisdictions to achieve a nation-wide approach.

Taking immediate action will ensure Victorians reap the multiple benefits of cutting emissions: avoiding the worst impacts of climate change, attracting new jobs and investment to the state and ensuring no one is left behind in the transition.

● Largest-ever group of investors calls on governments to phase out thermal coal power worldwide, put a price on carbon, end subsidies for fossil fuels, and strengthen nationally-determined contributions

MADRID – 631 institutional investors managing more than $37 trillion in assets urged governments to step up efforts to tackle the global climate crisis and achieve the goals of the Paris Agreement, in a joint statement issued today at the United Nations Climate Conference (COP25). The Global Investor Statement to Governments on Climate Change, developed by the seven Founding Partners of The Investor Agenda, urges governments to phase out thermal coal power, put a meaningful price on carbon pollution, end subsidies for fossil fuels, and update and strengthen nationally-determined contributions to meet the goals of the Paris Agreement.

“The global shift to clean energy is underway, but much more needs to be done by governments to accelerate the low carbon transition and to improve the resilience of our economy, society and the financial system to climate risks,” the investors wrote. They warned the current government commitments leave an “ambition gap” that will not prevent global average temperature from rising beyond the 1.5 degree threshold that scientists warn could trigger catastrophic and irreversible effects of climate change.

The investor call to action was mentioned by United Nations Secretary-General António Guterres in his remarks to Heads of State and Government at COP25. “I see the business community and the finance community very active. We received…a letter by the leaders of asset management entities…asking political leaders to enhance climate action, to end subsidies to fossil fuels, to put a price on carbon,” the Secretary-General said (text here).

Signing the Global Investor Statement to Governments on Climate Change is an action item in the Policy Advocacy focus area of the The Investor Agenda. Launched in 2018 by seven Founding Partners — 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 –The Investor Agenda is a collaborative initiative that aims to accelerate and scale up the investor actions worldwide, that are critical to tackling climate change and achieving the goals of the Paris Agreement with the aim of keeping global average temperature rise to no more than 1.5-degrees Celsius. It provides investors with a set of actions that they can take in four key focus areas: Investment, Corporate Engagement, Investor Disclosure and Policy Advocacy.

“Investors with $37 trillion in assets under management calling for our government leaders to act quickly and boldly on the global climate crisis is quite extraordinary,” noted Mindy Lubber, Ceres CEO and President. “With the immense influence that these investors hold in our economy, government leaders ought to respond to this collective call to action with the urgency and ambition required to power a net-zero emissions economy.”

“Investors are clear that governments should be much more ambitious in addressing climate change,” said Stephanie Pfeifer, CEO of the Institutional Investors Group on Climate Change (IIGCC). “The science shows we need to achieve climate neutrality by 2050 at the latest. Several leading economies have already set net-zero emissions targets and other countries must now follow their lead.”

“As investors in Asia and all regions are increasingly looking to allocate more capital into low carbon investments, they are urging governments and policy makers to unlock the barriers to enable the necessary transition to net-zero carbon economies,” said Rebecca Mikula-Wright, Director, Asia Investor Group on Climate Change (AIGCC). “The Investor Agenda has a pivotal role to play as a platform for supporting investors to lead ambition and catalyse sustainable investment, while promoting engagement across all regions and jurisdictions.”

“Global investors with US$37 trillion in assets under management are demanding that governments implement robust and credible climate change policy to reduce the costs of climate change for the global economy and for the communities we live in,” said Emma Herd, Chief Executive Officer, Investor Group on Climate Change (IGCC). “Global investors could not be clearer, governments must step up and deliver the policy ambition needed to manage the costs of climate change. Without ambitious climate goals, supported by investable policy, climate change as a risk to financial stability will continue to ratchet.”

“The Investor Agenda provides an unprecedented global forum for investors to accelerate action on climate change and drive transformation of capital markets to deliver a 1.5-degrees Celsius economy. To do that investors need to take further action themselves, but also require stronger incentives from governments,” said Paul Simpson, CDP CEO.

“The Investor Agenda has a critical role to play in compelling investors to act and bring about lasting change around climate,” said Fiona Reynolds, CEO of Principles for Responsible Investment (PRI). “Ambition and meaningful action from governments, business and the financial sector is imperative to curb the current trajectory of global warming. These groups must act now to curb the climate emergency the world is facing by reaching the goals of the Paris Agreement to realise 1.5-degrees Celsius.”

“There is a growing urgency for investors and corporations to act on climate change goals. As of today, temperatures have risen 1-degree Celsius above pre-industrial levels,” said Eric Usher, Head of UNEP Finance Initiative. “To keep the rise to within 1.5-degrees Celsius globally, leadership from within the investor community will be key. The Investor Agenda is a critical platform in supporting investors in their individual actions.”

Nearly 1,200 investors have taken action in one or more of the focus areas of The Investor Agenda since 2018, according to The Investor Agenda 2019 Annual Progress Report published in September. More than 750 investors have engaged with or directly influenced companies to act on climate change, more than 400 investors have stepped up their own disclosure on climate change and more than 260 investors have set a climate target for their investments.

Read the full Media Release
Read the Global Investor Statement to Governments on Climate Change

As Australia and our international peers gather at the UN Climate Conference in Madrid, it is clear that the world is not yet on track to stay within the temperature limits set out in the Paris Agreement. Getting there will require more ambition and action around the world, including in Australia. Our organisations, representing broad sections of the community and meeting as the Australian Climate Roundtable, today announced the next steps in our work to help Australia play our fair part in these efforts while maintaining and increasing our prosperity.

Australia needs coordinated action across our nation to meet this challenge. The Roundtable’s joint principles for climate policy, first agreed in 2015, set out common ground on the goals of climate policy and how to meet them. Today we release an update that strengthens these principles. The changes include:

• more closely reflecting the temperature goals of the Paris Agreement, which was drafted after our original principles;
• directly addressing the land sector for the first time, following the addition of the National Farmers’ Federation to the Roundtable;
• strengthening our recognition of the role of innovation, science and technology in making climate solutions more available and affordable; and
• affirming that the needs of vulnerable workers, communities and industries can, and should all be met in designing effective climate policies.

The Roundtable has also adopted a work plan for the coming year that focusses on building our shared understanding of the costs and impacts of climate change on Australia, and the pathways for a successful transition to a net zero emissions Australian economy. We will work with each other, our members across the community, and local and international experts on these issues, and present our findings over the course of 2020.

The Australian Climate Roundtable’s updated joint principles for climate policy are at www.australianclimateroundtable.org.au.

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The development of credible, long-term climate change strategies will improve investors’ ability to assess climate-related risks and opportunities, and invest in an orderly transition to a net zero emissions, climate resilient economy, the Investor Group on Climate Change (IGCC) said in a policy brief released today.

“Climate change is a systematic risk to investment returns, financial stability, communities and economies,” said Emma Herd, CEO. “The Paris Agreement’s long-term emissions strategies under development by the Australian^# and New Zealand* Governments must support a managed transition to net zero emissions and build resilience to the impacts of climate change.”

“As nations gather in Spain for this year’s Climate Summit, investors are looking to governments to deliver on their commitments under the Paris Agreement, and develop long term plans to manage economic impacts of climate change and unlock new investment opportunities.”

IGCC’s policy brief, Delivering an investable long-term emissions strategy, provides an overview of the role and implications of long-term emissions strategies for institutional investors, such as super and pension funds.

It set out six key principles to guide the development of investable long-term strategies in Australia and New Zealand:

• Engage in extensive consultation to build consensus on long-term emissions pathways;
• Undertake analysis of multiple scenarios to avoid the false sense of certainty that can emerge from focusing on a single scenario;
• Build on existing public and private sector processes, such as the Australian Sustainable Finance Initiative and the New Zealand Sustainable Finance Forum;
• Examine risks, opportunities and synergies between different sectors, and avoid an overreliance on macroeconomic modelling;
• Ensure consistency with the objectives of the Paris Agreement to limit global warming to 1.5^oC and well below 2^oC, and;
• Integrate the physical risks of climate change to ensure long-term strategies are resilient to the physical effects of climate change.

“Long-term investors have a critical role in delivering a prosperous future and are increasingly changing their investment practices to align with a net zero emissions economy,” Herd said.

“To strengthen investor confidence and unlock billions of dollars of private sector capital, it is vital that governments take action to support  the objectives of the Paris Agreement.”

“Lack of credible, durable and predictable policy frameworks means investors will either defer investment in local economies, invest in other countries where policy is more predictable, or factor in higher risk premiums on investments to hedge against policy risk.”

“The Investor Group on Climate Change looks forward to engaging further on these issues with the Australian and New Zealand Governments to deliver long-term benefits for the millions of super and pension fund holders in both nations,” Herd concluded.

Notes:

^# The Australian Government committed to develop a long-term strategy in 2017. It has also made this commitment internationally before and after the last federal election (here, here and here).

* See the New Zealand Government’s response to last year’s Productivity Commission report on the nation’s response to climate change.

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Download the Briefing Paper

Investor commitments to net zero emissions portfolios, science-based targets for infrastructure emissions and a first of its kind sovereign green bond for an emerging economy were all part of the initiatives recognised today at the inaugural Investor Group on Climate Change (IGCC) 2019 Climate Awards.

The IGCC Climate Awards, launched for the first time in 2019 at the IGCC Summit, aim to highlight the work of Australian and New Zealand investors delivering outstanding outcomes on climate change.

The initiatives and individuals identified as outstanding across the four award categories, were recognised for their sector leading approaches to tackling climate change through investment practice.

The winners of the 2019 IGCC Climate Awards are:

Outstanding Individual

Sam Mostyn: For her long-term contribution to driving climate change and sustainable finance across the investment industry and corporate sector more broadly, especially through her advocacy in incorporating climate change as a core part of Director and Trustee responsibilities.

Outstanding Initiative by an Asset Owner

Cbus:  Cbus has developed a Climate Change Road Map, including commitments for net zero emissions for property and direct infrastructure holdings by 2030 and a 1% growth option allocation for climate opportunities. Cbus are working with their external fund managers as a key part of their Climate Change Roadmap, who have been given until 2020 to outline their own roadmaps for net zero emissions.

Outstanding Initiative by an Asset Manager

IFM Investors: Through the IFM Australian Infrastructure Carbon Reduction Initiative, IFM Investors worked closely with its major Australian infrastructure assets and co-owners to establish science-based emissions reduction targets and pathways through to 2030. The assets include Ausgrid, Melbourne Airport, Brisbane Airport, NSW Ports (Botany and Kembla), the Port of Brisbane, Southern Cross Station and Northern Territory Airports.

Innovation of the year

International Finance Corporation (IFC) and the World Bank (WB): For Supporting the Republic of Fiji’s issuance of the world’s first emerging economy sovereign green bond. Fiji made history by becoming the first emerging market country in the world to issue a sovereign green bond, with the final tranche of a $100m Fiji dollar issuance in July 2018. It was also the first of its kind to list on the London Stock Exchange, was double-oversubscribed, and showcased a new way for small island states to access climate finance to adapt to a changing climate. With support from the Australian Government, the IFC and World Bank advised Fiji on preparing a green bond policy framework, structured the transaction, obtained an external review, and helped select eligible projects for funding.

The results were announced today at the IGCC 2019 Climate Change Finance and Investment Summit, being held in Sydney over 14-15 October.

“The IGCC Climate Awards are not about rewarding business as usual” said Emma Herd, Chief Executive Officer, IGCC. “In developing these awards, IGCC is aiming to put a spotlight on those individuals, organisations or initiatives that are driving real outcomes across the investment industry on climate change”.

“I congratulate the winners in the IGCC 2019 Climate Awards and want to thank all of the entrants for the incredibly high calibre of this year’s selection”, said Herd.

Judging for the IGCC 2019 Climate Awards was overseen by an independent panel, selected for their knowledge, expertise, objectivity and integrity. Judges scored each entry individually against the evaluation criteria and awards were determined by final consensus of the panel.  The Judging Panel reserved the right not to award a winner in a particular category, if it was felt that no application met the criteria or demonstrated sufficiently outstanding qualities.

For more information on the IGCC 2019 Climate Awards is available at www.igcc.org.au/awards

Read the full Media Release

Today, the Investor Group on Climate Change (IGCC) kicks off the 2019 Climate Change Finance and Investment Summit, with around 300 finance and investment representatives from around Australia and the region gathering to discuss how they are managing climate change as a core financial risk.

The theme of the IGCC 2019 Summit is: Catalysing Action on Climate Change.

“The Paris Agreement sent a huge signal to global markets, cementing understanding that climate change has a cost and that decarbonising the global economy represents a major new investment opportunity”, said Stephen Dunne, Chair, IGCC. “The finance and investment industry has a huge role to play. Which is why the Investor Group on Climate Change is so pleased to convene this important event”, said Dunne.

The IGCC 2019 Climate Change Investment and Finance Summit will take place on 14-15 October 2019, in Sydney, Australia. Around 300 attendees will hear from 64 speakers on the policy, investment and risk management impacts of climate change.
Discussions will address:

• Investment opportunities in climate resilient and net-zero emissions energy and infrastructure
• The new policy landscape and implications for investors
• Leadership and market practice in net zero emissions investment product and practice development
• Reporting on climate risks: Scenarios, big data, science and investor reporting
• Tools, frameworks and solutions for building resilience and investing in climate change adaptation
• Opportunities and insights from investors across Asia
• Company engagement: Hear the latest from investors and companies participating in Climate Action 100+

“Investors and financial regulators have identified climate change is a systemic risk to the economy, the financial system and the long-term returns for superannuation holders,” said Emma Herd, IGCC Chief Executive Officer. “Around the world, investors are actively managing climate risks and momentum is growing. However, much more needs to be done.”

Read the full Media Release

–   US$35 trillion Climate Action 100+ publishes first initiative progress report

 –   Breakthrough commitments have been achieved, yet step change in broader corporate response to climate change is necessary given US$20 trillion systemic risk to global economy

In the first Climate Action 100+ progress report released today, it is clear that despite significant progress achieved, far more needs to be done by the world’s largest corporate greenhouse gas (GHG) emitters in tackling climate change. 

Climate Action 100+ brings together more than 370 global investors with over US$35 trillion in assets under management, seeking to ensure some of the world’s largest companies take necessary action on climate change. The 161 ‘focus companies’ engaged through the initiative are collectively responsible for over two thirds of global industrial GHG emissions and represent a combined market capitalisation in excess of US$8 trillion.

Supported by Climate Action 100+ investor engagement, a range of breakthrough net zero emission commitments are now in place. Significant progress has been seen across a range of industries, many of which are among the most challenging to decarbonise. Examples of focus companies making substantial net zero commitments over just the past seven months alone include; HeidelbergCement, Duke Energy, Nestle, Daimler, VW, Thyssenkrupp, ArcelorMittal, BHP Billiton, Centrica and Saint-Gobain, among others.

Despite these examples of first-wave leadership, the analysis featured in the report shows a significant step change is still required from the majority of focus companies in addressing climate change as a strategic business risk. 

The report was released today by the Investor Group on Climate Change (IGCC) and its four global partners: Asia Investor Group on Climate Change (AIGCC); Ceres; Institutional Investors Group on Climate Change (IIGCC) and Principles for Responsible Investment (PRI). 

Read the full Media Release
Read the Climate Action 100+ Progress Report

• Largest-ever group of investors to call on governments to phase out thermal coal power worldwide, put a price on carbon pollution, end government subsidies for fossil fuels, update and strengthen nationally-determined contributions by 2020
• New report finds more investor climate action than ever before — 1,200 investors took action on climate change in line with The Investor Agenda in its first year

September 19, 2019, NEW YORK:  Ahead of next week’s United Nations Climate Action Summit, a record 515 institutional investors managing $35 trillion in assets urged governments worldwide to step up action to tackle climate change and achieve the Paris Agreement’s goals.

The Global Investor Statement to Governments on Climate Change, developed by the seven Founding Partners of The Investor Agenda, calls on governments to phase out thermal coal power worldwide, put a meaningful price on carbon pollution, end government subsidies for fossil fuels, and update and strengthen nationally-determined contributions to meet the emissions reduction goal of the Paris Agreement no later than 2020.

“The global shift to clean energy is underway, but much more needs to be done by governments to accelerate the low carbon transition and to improve the resilience of our economy, society and the financial system to climate risks,” the investors wrote. They warned the current government commitments leave an “ambition gap” that will not prevent global average temperature from rising beyond the 1.5 degree threshold that scientists warn could trigger catastrophic and irreversible effects of climate change.

The investors’ call to action published today comes as UN Secretary-General António Guterres is asking all leaders, from governments and the private sector, to present plans – at the UN Climate Action Summit on September 23 or at the latest by December 2020 – to cut greenhouse gas emissions 45% by 2030 and reach carbon neutrality by 2050. “I am also asking all investors to scale up green ventures, to increase lending for low-carbon solutions and to stop, in effect, financing pollution,” Secretary-General António Guterres said at a preparatory meeting for the Summit.

Signing the Global Investor Statement to Governments on Climate Change is an action item in the Policy Advocacy focus area of the The Investor Agenda. Launched in September 2018 by seven Founding Partners — 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 — The Investor Agenda is a collaborative initiative that aims to accelerate and scale up the investor actions worldwide that are critical to tackling climate change and achieving the goals of the Paris Agreement with the aim of keeping global average temperature rise to no more than 1.5-degrees Celsius. It provides investors with a set of actions that they can take in four key focus areas: Investment, Corporate Engagement, Investor Disclosure and Policy Advocacy.

The Founding Partners also announced today the release of The Investor Agenda Annual Progress Report, which found that nearly 1,200 investors have taken action in one or more of the focus areas of The Investor Agenda. More than 750 investors have engaged with or directly influenced portfolio companies to act on climate change, more than 400 investors have stepped up their own disclosure on climate change, and more than 260 have set a climate target.

“Investors are stepping up their response to climate change and increasingly aligning their investment with the goals of the Paris Agreement,” said Rebecca Mikula-Wright, Director, Asia Investor Group on Climate Change (AIGCC). “The Investor Agenda has a pivotal role to play as a platform for supporting investors to lead ambition and catalyse sustainable investment, while promoting engagement across all regions and jurisdictions.” 

“The Investor Agenda provides an unprecedented global forum for investors to accelerate action on climate change and drive transformation of capital markets to deliver a 1.5-degrees Celsius economy. To do that investors need to take further action themselves, but also require stronger incentives from governments” said Paul Simpson, CDP CEO. 

“The global reach and potential impact of The Investor Agenda and the global collaboration of the seven organizations are quite extraordinary,” noted Mindy Lubber, Ceres CEO and President. “With the immense power and influence that investors hold in our global economy, they have a tremendous opportunity and responsibility to act at the urgent pace and scale required to keep average global temperature rise to no more than 1.5-degrees Celsius.”

“By working with our peers globally and across the regions, we can scale up ambition and action to tackle climate change and deliver on the promise of the Paris Agreement,” said Emma Herd, Chief Executive Officer, Investor Group on Climate Change (IGCC). “Collaboration is the key to success, and investors must play our part. The Investor Agenda is the platform we need to drive real investor action at this crucial point in time.” 

“Climate change poses an unprecedented threat to the global economy,” said Stephanie Pfeifer, CEO of the Institutional Investors Group on Climate Change (IIGCC). “Investors representing nearly half the world’s invested capital are sending a clear message that they need to see far greater ambition from governments in addressing the climate crisis. A considerable number of countries have already committed to delivering net zero emission economies by 2050. Investors are asking that others now follow their lead.” 

“The Investor Agenda has a critical role to play in compelling investors to act and bring about lasting change around climate,” said Fiona Reynolds, CEO of Principles for Responsible Investment (PRI). “Ambition and meaningful action from governments, business and the financial sector is imperative to curb the current trajectory of global warming. These groups must act now to curb the climate emergency the world is facing by reaching the goals of the Paris Agreement to realise 1.5-degrees Celsius.”

“There is a growing urgency for investors and corporations to act on climate change goals. As of today, temperatures have risen 1-degree Celsius above pre-industrial levels,” said Eric Usher, Head of UNEP Finance Initiative. “To keep the rise to within 1.5-degrees Celsius globally, leadership from within the investor community will be key. The Investor Agenda is one critical platform in supporting investors in their individual actions.”

Read the full Media Release
Read the Global Investor Statement to Governments on Climate Change
Read The Investor Agenda Annual Progress Report