The Institutional Investors Group on Climate Change (IIGCC) and other investor groups have called on governments to “not lose sight of the climate crisis” as they pursue efforts aimed at economic recovery from the coronavirus crisis.
In a statement primarily sent to G20 nations, the groups said that in their recovery plans, governments should “prioritise sustainabilty and equity, and accelerate the transition to a net-zero emissions economy to mitigate climate risk, create new jobs and catalyse the sustainable deployment of private capital”.
“Recovery plans that exacerbate climate change would expose investors and national economies to escalating financial, health and social risks in the coming years,” the investor groups argued. “Governments should avoid the prioritisation of risky, short-term emissions-intensive projects.”
More specific points made included that preparing for and responding to disruptions like pandemics and climate change required investments in scenario testing, assessments of corporate responses to risk, adapation and a framework for a just transition.
The investor groups’ call is not radical. Several global figures having spoken about the need for the economic recovery to be aligned with sustainability goals and in the EU the members of the European Council have said the Green Deal should play a central role in the economic recovery.
Frans Timmermans, executive vice-president of the European Commission, has said the timetable for the EU climate law remains unchanged by the coronavirus pandemic.
Some EU governments are looking to attach environment-minded conditions to rescue plans for the airline industry, which has been hit hard by measures adopted to contain the virus.
In France, the minister of the economy has said state aid for Air France would be conditional upon the airline halving the amount of CO2 emissions from domestic flights by the end of 2024.
In the G20, finance ministers recently said they were committed to “an environmentally sustainable and inclusive recovery,” although they did not specifically mention climate change. COP26, the next major UN summit about the Paris Agreement, has been postponed until an unspecified date in 2021 because of the coronavirus.
“The policy frameworks already exist to steer a sustainable recovery, we need to ensure their implementation”
Stephanie Pfeifer, CEO of the IIGCC
Stephanie Pfeifer, CEO of the IIGCC, said: “Once people are taken care of, governments should be signalling their intentions for a sustainable recovery by incorporating climate conditions into financial support for companies.
“Longer-term economic stimulus spending needs to focus on supporting green industries and infrastructure, and avoid further carbon lock-in. The policy frameworks already exist to steer a sustainable recovery, we need to ensure their implementation. We can’t leave climate action behind.”
The investor groups behind the statement represent the majority of the world’s leading institutional investors: the IIGCC, Asia Investor Group on Climate Change, CDP, Ceres, Investor Group on Climate Change, the Principles for Responsible Investment and UNEP Finance Initiative.