Mary Schapiro: Empowering Investors to Effect Climate-Change Action
Sir, The debate in the Financial Times about climate change, triggered by Bank of England governor Mark Carney’s speech on the risks of climate change for financial stability, merits a broader perspective than just those investing in fossil fuels. The debate has indeed been going for years, but what is new and deserves a closer look in the run-up to the UN COP 21 climate conference in Paris is the potential for the global investor community to influence climate-change action goals. Providing the investor with information on the magnitude and probability of different types of economic or financial impacts of climate change on a company’s performance through sustainability reporting standards enables the investor to make better and more informed decisions on capital allocation.
Mr Carney’s speech as chair of the Financial Stability Board should not be perceived as a call for rafts of new regulation as the answer to financial risks from climate change but as an opportunity to enhance transparency and disclosure. His proposal for a climate disclosure task force under the auspices of the G20 provides a real opportunity to capitalise on transparency initiatives and disclosure rules already in place to assist the investor in making smart climate action-oriented investment decisions.
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