Hundreds of heavyweight investors representing some $24 trillion in assets, called Thursday for stronger political leadership and more ambitious policies to finance a global transition to a low-carbon and climate-resilient economy.

The statement, issued days before United Nations Secretary-General Ban Ki-moon will host the Climate Summit in New York, was coordinated by four investor groups on climate change – Ceres’ Investor Network on Climate Risk in the United States, the European Institutional Investors Group on Climate Change, the Investors Group on Climate Change in Australia and new Zealand, and the Asia Investor Group on Climate Change – with the United Nations Environment Programme Finance Initiative and Principles for Responsible Investment.

“We are particularly concerned that gaps, weaknesses and delays in climate change and clean-energy policies will increase the risks to our investments as a result of the physical impacts of climate change, and will increase the likelihood that more radical policy measures will be required to reduce greenhouse gas emissions,” the group of more than 340 institutional investors representing more in a statement issued Thursday.

“In turn, this could jeopardize the investments and retirement savings of millions of citizens.”

“This is the biggest fund managers – representing hundreds of millions of people – saying, on the 23rd of September, they are really pressing the world’s leaders to take action,” said David Pitt-Watson, chairman of the UN Environment Programme’s Finance Initiative, in a conference call with reporters.

The investor groups called on government leaders to institute carbon pricing to help redirect investment and develop plans to phase out subsidies for fossil fuels.

Their announcement marks “a true sea change in the way that investors are behaving and what it is that they’re saying,” said Pitt-Watson, who has been in fund management for 40 years. “It’s not just the planet that’s at risk here; it’s people’s savings and pensions that are at risk here if we don’t take action.”

He cited work from the International Energy Agency, which concluded this year that investments in low-carbon energy technologies must at least double – to $500 billion per year – by 2020, and then double again by 2030, to limit global warming to 2 degrees Celsius and thereby avoid the worst effects of climate change.

“We’re not doing anything like that,” he said, but added that such an investment is not out of reach.

“That trillion is pretty small relative to the 225 trillion that make up capital markets,” he said. “We are here at a real point of inflection — where the biggest and most powerful institutions in investment are saying we need change and are demonstrating that they can bring about some of that change.”

Only by imposing stable, meaningful prices on carbon and eliminating subsidies on carbon can governments move toward solving the problem, he said.

In their statement, the investors vowed to:

  • Work with policy makers to encourage  investment in climate change adaptation;
  • Identify and evaluate low-carbon investment opportunities;
  • Develop their capacity to assess risk and opportunity presented by climate change to investment portfolios;
  • Work with companies they invest in to minimize and disclose risk and maximize the opportunities presented by climate policy;
  • Report on progress they make in addressing climate risk.

They called for stronger regulations on energy efficiency and renewable energy and support for innovation in and deployment of low-carbon technologies.

The call for governments to provide stable, reliable and economically meaningful carbon pricing is a key point, said one hedge fund risk manager who was not involved in the statement, but supports it.

Every economist understands that some things are not priced, but should be, he said. Without carbon pricing, “it’s as if your neighbor were allowing his septic tank to run into your yard or, worse, collecting waste from other neighbors at a profit and then draining the effluent into your vegetable garden,” he said.

The investors also said they want to see a global agreement on climate change reached by the end of next year. “This would give investors the confidence to support and accelerate the investments in low-carbon technologies, in energy efficiency and in climate-change adaptation,” their statement said.