International investor groups, including the Investor Group on Climate Change (IGCC), have encouraged global governments to ensure they are planning for a sustainable recovery from the COVID-19 pandemic by factoring in climate change risk into economic recovery plans.
The global statement, which has been sent to G20 countries and New Zealand, reinforces that governments’ first priority amid the COVID-19 pandemic is to save lives and provide financial relief to support the most vulnerable.
As governments look to spark longer-term economic recovery, the investor groups warn locking in carbon-intensive economic activities will only exacerbate systemic climate risk and expose economies to escalating shocks. The groups say governments should instead look to drive efficient private capital investment, that can create fresh employment and economic growth, by prioritising net zero emissions projects in areas like infrastructure, transport, property and energy.
The global statement is signed by the heads of the founding partner organisations of The Investor Agenda, including IGCC, the Asia Investor Group on Climate Change, the Institutional Investor Group on Climate Change, Ceres, Principles for Responsible Investment, CDP and the United Nations Environment Programme Finance Initiative.
The investor organisations recommend governments adopt five measures for a sustainable recovery:
- Prioritise human relief and job creation
- Uphold the Paris Agreement
- Ensure corporate assistance assesses climate risk
- Prioritise climate resiliency and net zero emissions solutions
- Embed investor participation in recovery planning
Stephen Dunne, CBUS Board Director and Chair of Investment Committee, Queensland Investment CorporationBoard Director, and IGCC Chairman, said: “As we respond to the economic hit from the COVID-19 pandemic we must remain conscious that climate change continues to be a systemic risk to businesses, investors and communities. As a result, investors are increasingly pricing climate risk into their investment decisions and looking for resilient assets that will provide sustainable returns.
“As governments begin considering a recovery from the COVID-19 pandemic they should look to capitalise on potential new private investment,that can create fresh jobs and growth, by integrating recovery plans with policies to accelerate a transition to netzero emissions across energy, infrastructure and industry such as investing in an upgrade of our electricity grids and improving the overall energy efficiency ofproperty.”
Emma Herd, IGCC Chief Executive Officer, said: “Investors strongly support new measures to drive a sustainable recovery. We already know that government policy that spurs fresh private investment in clean energy, green industry and other sustainable infrastructure will lead to much needed jobs and economic growth.
“The Australian Government should be looking to integrate recovery plans with its Technology Investment Roadmap, Long-Term Emissions Reduction Strategy, grid modernisation planning and bushfire recovery,to build greater resilience and reduce climate risk.
“The New Zealand Government should heed the advice of its Climate Change Commission and embrace smart investment decisions in low-emissions planning, technologies and infrastructure.”