Investor coalition calls for mandatory climate disclosure

16 September, 2022

Governments around the world are being urged to mandate climate transition commitments by a coalition of asset managers representing $39trn in capital. 

Coordinated by the Investor Agenda, the call to action is signed by 532 firms including Franklin Templeton, Amundi, BMO Global Asset Management and Ninety One.  

These firms are calling upon governments to mandate climate transition plans from corporates. 

This would include mandatory climate risk disclosure and climate regulation for companies.  

“Effective policies, in line with limiting global warming to no more than 1.5C, are essential for accelerating and scaling up private capital flows needed for a climate-resilient, net-zero transition,” read the letter. 

“The ongoing energy security crisis further highlights the imperative for an orderly transition and accelerated clean energy policies and investments, which can secure countries against volatile prices and supply side shocks.” 

Other industry bodies have also been calling for mandatory climate reporting by companies. Read Minerva's previous coverage on this topic:

https://www.old.manifest.co.uk/sec-chair-urges-mandatory-climate-risk-disclosures/

To facilitate this, the coalition is pushing for governments to introduce more mandatory regulations and move away from a voluntary compliance-based model. 

Five key demands were highlighted in the letter:  

1. Ensure that governments’ 2030 targets align with the goal of limiting global temperature rise to 1.5C (acting if this is not the case before COP27). 

2. Implement domestic policies to ensure government 2030 greenhouse gas emissions are aligned with keeping global temperature rise to 1.5C – requiring an acceleration of the development, deployment, and dissemination of technologies enabling this transition. 

3. Supporting the effective implementation of the Global Methane Pledge to reduce emissions by at least 30% from 2020 levels by 2034. 

4. Building on the agreed outcomes of COP26 and scaling up the provision of climate finance from the public and the private sector for mitigation, adaptation, and resilience (with a particular focus on developing countries). 

5. Strengthen climate disclosures across the financial system, including mandatory TCFD reporting.  

The coalition added that investors are “stepping up to the challenge” and that governments’ ability to deliver on net-zero commitments will depend on private capital flows.