JOINS U.S. AND EUROPEAN INVESTORS CONFRONTING CLIMATE CHANGE
RISKS AND OPPORTUNITIES
Bold Commitments to Energy Efficiency and Other Clean
Technologies, Require Closer Scrutiny of Carbon-Intensive
Florida Chief Financial Officer Alex Sink joined
nearly 50 leading U.S. and European institutional investors
managing over $1.75 trillion in assets in releasing a climate
change action plan at the United Nations that will boost
investments in energy efficiency and clean energy technologies
and require tougher scrutiny of carbon-intensive investments
that may pose long-term financial risks.
The action plan was announced at the Investor Summit on Climate
Risk, hosted by Ceres and the United Nations Foundation and
attended by more than 450 investor, financial and corporate
leaders from around the world. Signatories to the action plan
include state treasurers, controllers, pension fund leaders,
asset managers and foundations from London, California, Florida,
New York, Connecticut, North Carolina, Pennsylvania and a dozen
"With today’s action plan, investors are advancing the need for
closer scrutiny of investments to include the financial risks of
climate change, while also harnessing emerging opportunities,"
said Florida Chief Financial Officer Alex Sink. "Florida is on
board as the first State Treasury in the nation to require fund
managers to disclose how they incorporate climate risk into
prudent investment management."
Noting that climate change presents both material risks and
significant opportunities, the investors pledged to collectively
invest $10 billion in clean technology opportunities over the
next two years and to incorporate green building standards —such
as LEED (Leadership in Energy Efficiency and Design) and Energy
Star — into their investment decisions. Calling energy
efficiency "one of the fastest, easiest and cheapest ways to
significantly reduce emissions and improve the bottom line," the
investor group pledged to reduce energy use in core real estate
holdings by 20 percent over the next three years.
A new McKinsey Global Institute (MGI) report, also announced at
the investor summit, concludes that major investments over the
next decade in energy productivity — the level of output
achieved from the energy consumed — could earn double-digit
rates of return for investors. Such investments would cut global
energy demand growth by at least half and achieve up to half of
the reductions of greenhouse gas emissions that experts say is
required to prevent the world's mean temperature from increasing
by more than 2 degrees centigrade.
The action plan calls for a series of specific steps by
investors to address the growing risks and opportunities from
climate change. The nine goals include policy actions aimed at
the Securities and Exchange Commission (SEC) and Congress,
engagement with companies to improve their disclosure and
responses to climate change, minimizing climate investment risks
and maximizing climate-related investment opportunities. Among
the investor commitments:
• Support clean technology, with a goal of deploying $10 billion
collectively over the next two years.
• Aim for a 20 percent reduction in energy used in core real
estate investment holdings over a three-year period, and
consider green building standards in making investment
• Require and validate that investment managers, investment
consultants and advisors report on how they are assessing
climate risks in their portfolios, whether from new
carbon-reducing regulations, physical impacts or competitive
• Encourage Wall Street analysts, rating agencies and investment
banks to analyze and report on the potential impacts of
foreseeable long-term carbon costs, in the range of $20 to $40
per metric ton of CO2, particularly on carbon-intensive
investments such as new coal-fired power plants, oil shale, tar
sands and coal-to-liquid projects.
• Push the SEC to issue guidance leading to full corporate
disclosure of climate risks and opportunities.
• Push Congress for a mandatory national policy to reduce
national greenhouse gas emissions in accordance with the 60-90
percent reductions below 1990 levels by 2050 that scientists
suggest is urgently needed to avoid the worst and most costly
impacts from climate change.
"This action plan reflects the many investment opportunities
that exist today to put a dent in global warming pollution,
build profits and benefit the global economy," said Mindy S.
Lubber, president of the Ceres investor coalition and director
of the Investor Network on Climate Risk. "Leveraging the vast
energy efficiency opportunities at home and abroad holds
especially great promise for investors."
The summit comes as worldwide investor attention on climate
change dramatically increases. In the last two years, investor
and asset manager participation in the Investor Network on
Climate Risk has more than doubled, to more than 60
institutional investors and with collective assets totaling $4.5
trillion. At today's summit, Deutsche Asset Management, which
manages over $800 billion in assets, announced it was joining
INCR, increasing INCR's total member assets to over $5 trillion.
Today's climate risk meeting was hosted and organized by the
United Nations Foundation, the United Nations Fund for
International Partnerships and Ceres, which directs the Investor
Network on Climate Risk. Ceres is a U.S. coalition of investor
and environmental leaders that has spearheaded national and
international investor activity on climate risk issues. A
webcast of the summit and press conference can be found at