An alliance of some of the world’s largest investment groups, worth a combined total of $22 trillion in assets, urged world leaders this week to take calls for action on climate change seriously.
Ceres, which represents institutional investment interests around the world, sent an open letter to the globe’s largest governments (PDF) calling for steady, consistent public policies that “encourage low carbon investment,” along with stronger international agreements on greenhouse gas reductions.
The letter follows a major report issued by the World Bank on Monday, which predicts that Earth’s climate will warm by about 4 degrees on average by the end of the century — a scenario that would devastate poorer countries, cause widespread droughts and famine, water shortages, a dangerous rise in sea levels and massive population displacement.
The World Bank warned that scientists agree super storms like Hurricane Sandy will occur with greater frequency and strength in a warmer world. “Lack of action on climate change threatens to make the world our children inherit a completely different world than we are living in today,” World Bank Group President Jim Yong Kim said in prepared text. “Climate change is one of the single biggest challenges facing development, and we need to assume the moral responsibility to take action on behalf of future generations, especially the poorest.”
To that effect, a growing number of corporations have been undertaking executive level reviews of policies pertaining to climate change. The Carbon Disclosure Project said earlier this year that 343 companies on the S&P 500 participated in its annual report for 2012, and 83 percent of those companies said they were incorporating climate strategies into their risk reduction strategies. Insurance companies in particular have faced growing losses due to the elevated number of extreme weather events seen in recent years. Ceres noted that insurers were paying approximately $3 billion a year for weather-related damages in 1980, versus more than $20 billion in 2010.
“Strong carbon-reducing government policies are an urgent imperative. Hurricane Sandy, which caused more than $50 billion in economic losses, is typical of what we can expect if no action is taken and warming trends continue,” Chris Davis, Ceres’ director of investor programs, said in an advisory. “Investors are rightly concerned about the short and long-term economic risks of climate change and understand that ambitious climate and clean energy policies are urgently needed to avoid catastrophic impact.”
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