Follow the money - Investors lead charge on climate change
An international summit Tuesday to mark the second anniversary of the Paris climate agreement has drawn world leaders, celebrities, companies, and environmental groups to the French capital, all aiming to keep up momentum on efforts to curb global warming.
Financial institutions are using the meeting to highlight the need to ensure that their investments don't suffer from, or contribute to, the effects of climate change, such as rising sea levels and more extreme weather around the world.
Here are some of the major announcements and plans being considered at the Paris summit:
A group of institutional investors calling themselves Climate Action 100+ said that it would use its financial clout to raise the issue of climate-related risk with companies.
The group, which comprises 225 investment funds managing more than US$26 trillion in assets, said that it will focus its efforts on 100 of the world's largest corporate greenhouse gas emitters.
The idea is that companies will heed the concerns of major funds because they don't want to be considered a bad investment due to the financial risks that climate change might pose for their business.
Over 200 companies have pledged greater transparency on reporting climate-related risks in their businesses as part of a voluntary program led by American billionaire Michael Bloomberg.
The former New York mayor and Mark Carney, the governor of the Bank of England and chairman of the Financial Stability Board, said Tuesday that the number of companies supporting the program had more than doubled since its recommendations were first published in June.
The 237 companies, with a combined value of over US$6.3 trillion, include construction firms, energy companies, and financial institutions from 29 countries.
Carney said the Task Force on Climate-related Financial Disclosures plans to report on its efforts when leaders of the group of 20 leading industrialised and emerging economies meet in Argentina in a year.
Dutch bank ING plans to have zero investments in coal power generation by 2025.
The company said Tuesday that it expects fossil fuels to remain a key source of energy in the coming decades but wants to see the most polluting kind coal phased out.
ING said that rather than walk away from clients who don't meet its environmental risk policies, the bank will try to work with them to help improve their climate footprint.
It added, though, that "when engagement and improvement don't work, we don't provide financing."
Norwegian pension fund Storebrand said it is expanding its portfolio of fossil fuel-free investments to over US$3 billion.
Storebrand, which has US$80 billion in assets under management, said Tuesday that the move reflected growing public concern over climate change.
The company has recently tightened its rules, ditching investments in companies deemed to be among the most polluting as a result.
French President Emmanuel Macron, who is hosting the summit, is proposing an increase in the cost of carbon emissions.
Macron said he believes the global economy needs a "shock" if the goal of keeping global warming below 2 degrees Celsius (3.6 Fahrenheit) is to be achieved.
Macron told French daily Le Monde that he doesn't favour outright bans on gasolene vehicles, for example, but rather financial incentives for companies to invest in renewable energy and new modes of production.
One such incentive would be to raise the minimum price of per metric ton of carbon dioxide to €30 (US$35.39) a position Macron acknowledged not all European countries agree on yet. Current prices for the greenhouse gas in Europe are up to five times lower. He told the newspaper that while carbon-intensive industries won't welcome such a move, "without this shock to change productive behaviour, we will not get results."
Among the issues being discussed in Paris is how to increase financial support for poor countries, including for a United Nations fund meant to help put their economies on a climate-friendly track. The fund, agreed on in 2009, aims to raise US$100 billion a year by 2020 but is currently about a third short.
The prime minister of the Pacific island nation of Fiji warned Tuesday that climate change should be considered a life or death issue for millions of people around the world.
Frank Bainimarama, who chaired last month's UN climate meeting in Bonn, Germany, said the financial resources required to shift the world economy on to a low-carbon path were there, but that the money needs to flow faster if it is going to make a difference on the ground.