The Covid-19 recovery plans should be sustainable and help to reach the goals of the Paris climate accord, according to a number of global investor groups responsible for the management of trillions of dollars in assets.
The Institutional Investors Group on Climate Change (IIGCC) appealed in an open letter to Government of the G20 for these “not lose sight of the climate crisis” as they pursue efforts aimed at economic recovery from the coronavirus crisis.
The investors insisted that their recovery plans, governments should “prioritise sustainability 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”.
The IIGCC said that it “recognises governments’ immediate priorities must be intervening to save human lives and providing economic and financial relief to support the most vulnerable, stem the health crisis and curb economic disruption. Many governments are now beginning to consider economic recovery measures to address the acute shock and
impacts of the COVID-19 pandemic.”
“With trillions of dollars in capital under their management, investors will be critical to accelerating the recovery as it will require the efficient and equitable deployment of both public and private capital in fiscally-challenging times. Institutional investors take a long-term view of value and returns, and are therefore well placed to assist governments devise multi-year recovery efforts.”
The group said that as governments pursue efforts to recover from this economic downturn, they should not lose sight of the climate crisis. They must factor in the foreseeable, acute, systemic and compounding climate-related economic and financial risks. Investors increasingly face physical and transitional risks from a rapidly warming planet that challenge their ability to deliver long-term returns for their beneficiaries.
At the same time, the investors said, accelerating the net zero emissions transition can create significant new employment and economic growth, along with other co-benefits such as energy security and clean air.
“With effective recovery policies in place, private investment could be channeled to accelerate the development of new sustainable and climate adaptation assets.
