Investors Slowly Start to Push Climate Change up Their Agenda

Investors are slowly starting to push companies to reduce their carbon footprint and help the world meet targets on limiting global warming that were agreed in the 2015 Paris climate talks.

Energy firms have faced shareholder demands to do more to curb carbon emissions, while some pension funds are demanding more commitment to climate goals from firms they invest in.

Yet progress has still been modest since the Paris deal agreed by almost 200 nations came into force in November last year, aiming to limit global warming to 2 degrees Celsius (3.6 Fahrenheit) above pre-industrial times.

"Lots of investors are looking to align their investments with a 2 degrees world.  It's just at what pace they all get there," said Fiona Reynolds, managing director at the United Nations-backed Principles for Responsible Investment.

Advocates of the climate deal hope new impetus will come from Thursday's document[s] published by the Financial Stability Board's Task Force on Climate Related Financial Disclosures (TCFD), a group set up by G20 nations.

The task force's document outlines a voluntary framework for companies to disclose the financial impact of climate-related risks and opportunities, drawing support from more than 100 companies with $11 trillion of assets.

It aims to help investors, lenders, insurers, and other stakeholders understand how firms manage climate risk and guide companies on information they should provide to explain their climate strategy, ultimately helping ensure corporate laggards are held to account.

"The more companies report effectively on climate related risks and opportunities, the easier it becomes for investors to allocate the substantial amounts of capital required to implement the Paris Agreement," said Philippe Desfossés, chief executive of French pension fund ERAFP.

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