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Financial Sector Calls on G8 to Back Deep Emission Reduction Targets to Avoid High Costs Caused by Global Warming

Truth and Reconciliation-UNEP Head Urges Countries to Face the Facts and Put Aside Differences to Overcome Climate Change

World Environment Day 2007

Oslo/Nairobi, 5 June 2007-Heads of more than 20 leading financial service companies are today calling on the G8 to back deep emission reduction targets on the eve of the summit in Heiligendamm.

They fear that unchecked climate change is likely to lead to an increase in climate-related disasters, with “grave social and environmental harm” including annual economic losses that could rise as high as USD 1 trillion by 2040.

The companies, members of the United Nations Environment Programme`s Finance Initiative, said in a statement today to the G8 summit in Heiligendamm:” There has been a seismic shift in how climate change is perceived and it is widely considered to be the greatest market failure ever”.

“Many of the effects of climate change are beginning to be manifested and the threats posed by continued warming will affect-and even possibly disrupt-the operation of markets, societies, ecosystems and cultures,” it says.

The statement, signed by 23 Chief Executive Officers, Presidents, Chairmen and Managing Directors of banks, insurance and re-insurance companies’ calls on Head of State to formally adopt emission reduction targets no later than 2009. The statement was developed by the UNEP Finance Initiative’s Climate Change Working Group.

They suggest that proposals by the UK and the European Union, setting out mandatory emission reductions of between 20 per cent and 30 per cent by 2020 and 60 per cent to 80 per cent by 2050, should be central to all industrialized country goals.

The move reflects growing global interest from business and industry for action on climate change. Today’s statement comes some six months after large corporations in America, including Duke Power, Alcoa and General Electric joined forces with NGOs to establish the United States Climate Action Partnership along with calls for emissions controls.

Achim Steiner, UN Under-Secretary-General and UNEP Executive Director, speaking on the occasion of World Environment Day (WED) hosted in northern Norway, today welcomed the move.

”We are here in Norway for WED under the banner Melting Ice-A Hot Topic. We have heard at first hand from local communities, including indigenous peoples such as the Saami how climate change and disappearing ice is impacting on livelihoods, natural resources and ecosystems. Scientists advise us that melting ice at the poles and in mountains will also impact on water supplies, coastlines and communities across the globe. So the issue of melting ice is as much an issue for the Arctic as it is for peoples south of the Equator”.

“The Arctic and icy regions are in the front-line, but there are front-lines opening up everywhere as a result of climbing greenhouse gases- not least for industry and business like the financial services sector who are facing escalating risks to themselves and their customers,” he said.

“So I would urge leaders of nations at this G8+5 summit to draw inspiration from other examples of how deep rooted divisions of the past have been overcome. South Africa´s Truth and Reconciliation Commission is one example,” said Mr Steiner, who as part of WED celebrations in Norway shared a podium with Archbishop Desmond Tutu of South Africa.

“Let us acknowledge the truth as evidenced by the rigorous scientific findings of the Intergovernmental Panel on Climate Change in their striking reports this year. We must also recognize the fact that to delay action will only make the task harder and the solutions-be they market-led or technologically driven-slower in responding to the challenge,” said Mr Steiner.

“Countries must reconcile their differences and find common cause and build mutual trust around the achievements already being made. Indeed instead of finger pointing, nations should point to the emissions cuts being made in developed and rapidly developing economies alike,” he added.

“These are proof that investments in change can indeed deliver quantum leaps forward towards the low carbon economies that can transform the future. If the G8 can help build that trust, then it is not a very big step towards a multilateral agreement able to deliver the deep and meaningful reductions so urgently needed post 2012,” said Mr Steiner.

Dr. Joachim Faber, Member of the Executive Board, Allianz SE, said” Setting clear and mandatory, medium and long-term emission reduction targets and implementing appropriate incentive schemes should be part of a new climate change regime. Politics should not disappoint the trust of the market. What the economy needs is planning reliability for future investment decisions”.

Dr. Torsten Jeworrek, Member of the Board of Management Munich Re, said:”Munich Reinsurance Company has signed the declaration on climate change by the financial services sector because climate change is one of the greatest challenges of our time”.

“The latest studies show that it is cheaper to invest in climate protection than to pay for the losses that result from inactivity. It is thus prudent to act now from an economic perspective as well, “he said.

Peter Sands, Group CEO, Standard Chartered, said:” At Standard Chartered, we take a long term view of the consequences of our actions and we are committed to building a sustainable business. We recognise our capacity for social and economic contribution, the need to protect the environment and for good governance in all the markets that we operate in. We are proud to be a signatory to the UNEP FI Declaration on Climate Change”.

Barbara J. Krumsiek, President & CEO, Calvert, said: “As investors, we have a history of integrating climate change solutions into our investment philosophy and proxy voting. Now that the issue has reached the global crisis proportions, we need to help expand that focus by emphasizing the essential role public policy has to play”.

“This statement appropriately calls on governments to take strong action to curb greenhouse gas emissions not only to address this crisis but to also help protect the long-term investment horizon by spurring companies to set and meet hard targets to reduce greenhouse gas emissions,” she said.

Notes to Editors
The statement by members of the UNEP Finance Initiative in full is available online

For More Information Please Contact Nick Nuttall, UNEP Spokesperson, on Tel or text: + 254 733 632755, +254 727 531 253, E-mail: nick.nuttall at unep.org or Paul Clements-Hunt, Head UNEP FI, Tel:+41 79 349 5486, E-mail: pch at unep.ch

UNEP News Release




Further Resources

Declaration on Climate Change by the Financial Services Sector

UNEP Finance Initiative

G8 Summit 2007 Heiligendamm

World Environment Day 2007
Melting Ice - A Hot Topic!

World Environment Day 2007 Highlights

Rapid Rise in Tourism New Challenge to Polar Environment
New UNEP report released to mark World Environment Day: "Tourism in the Polar Regions - The Sustainability Challenge"


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