Investors have urged world leaders to make progress on climate change issues following the recent G20 summit in Japan.
World leaders gathered in Osaka last week (Friday 28 June) to discuss issues affecting global populations. The meeting of 19 countries and European Union representatives, was a gathering of world leaders representing around 80% of the world’s economic output.
While the US has been urging leaders to ease their policies on climate change, France and the UK have been strong supporters of the need to take stronger action.
Seiji Kawazoe, senior stewardship officer at Sumitomo Mitsui Trust Asset Management, said that decisions taken at the G20 normally sets the tone for companies to follow in the year ahead.
Kawazoe’s comments follow a statement published last Wednesday by fund groups representing some $34trn in assets under management, calling on world leaders to implement new rules guaranteeing that coal power would be phased out. The statement, signed by 477 investor groups also called for the introduction of carbon pricing.
“In our view the development of new coal power plants after 2020 puts at risk both the return on investment and the world’s chance of limiting global warming in line with the goals of the Paris Agreement,” said Carola van Lamoen, head of active ownership at Robeco.
Sumitomo’s Kawazoe said the meeting’s location in Osaka was also significant, as it would likely influence Japanese public and private sectors to become more proactive on tackling climate change.
He explained: “In May 2019, the Task Force on Climate-related Financial Disclosures was established in Japan supported by various government entities including the Ministry of Economy, Trade and Industry, the Financial Services Agency and the Ministry of the Environment.
“Over 160 companies attended the launch event and more than 70 companies became supporters, leading to more than 170 Japanese endorsers, the largest in the world. This is proof that Japanese companies are becoming keener to tackle climate change issues.”