Industry, Investors Urge Strong U.N. Climate Deal

Alister Doyle and Gerard Wynn, PlanetArk 9 Dec 08;

POZNAN - Major companies, investors and insurers appealed on Monday for decisive action to fight climate change at a meeting in Poland working on a new U.N. pact to fight global warming.

Climate negotiators in the western city of Poznan are meeting on a new climate treaty meant to be agreed by next December in Copenhagen to replace or extend the Kyoto Protocol after 2012.

"At a time when the global economic downturn may cause some to question whether now is the time to act, we believe that decisive action will stimulate global economic activity," leaders of more than 140 companies said.

The statement, drafted by the UK-based Corporate Leaders' Group on Climate Change (CLG), represented companies including Ebay, Sun Microsystems Inc, BP, and Unilever.

Climate policies such as carbon trading or carbon taxes add to fuel bills and impact the profitability of investment choices for example between fossil fuels and low-carbon alternatives, and business lobbies say they want more clarity.

"If business people cannot see what is the next 10, 15, 20 years they cannot assess the profitability of their investments," said Guy Sebban, secretary general of the International Chamber of Commerce, a global federation of employers and businessmen.

Some delegates, negotiators and analysts at the U.N. talks have suggested that the financial crisis coupled with the short time available for U.S. President-elect Barack Obama will scale back ambitions for Copenhagen.

That could water it down to an agreement on a set of principles rather than a full treaty to confront warming. That could make it harder to agree goals for emissions cuts in time before current goals under the Kyoto Protocol expire in 2012.

An investor delegation for the first time presented on Monday a call for action to the annual U.N. climate talks.

Their statement, signed by 152 global investors worth over $9 trillion, called on world leaders to negotiate a strong and binding successor to the Kyoto Protocol, to ensure investors receive market signals to fund a transition to a low-carbon economy.

Like the CLG statement, the banks and pension funds called for a continued commitment to carbon markets -- favored by the business community as a flexible, low-cost regulatory approach to curbing carbon emissions.

Insurers also said they had a role to play in a future deal, especially to help offset the costs of adapting to the impacts of climate change such as rising seas, droughts and floods.

"The insurance sector is one that most directly experiences the impacts of climate change," said Andrew Torrance, head of ClimateWise which groups 42 insurers. "We are looking forward to insurance being a central component of a Copenhagen deal."

He said insurers paid a record $83 billion in disaster-related payments in 2005, the year of Hurricane Katrina in the United States.

(Additional reporting by Gabriela Baczynska)

(Editing by Keith Weir)