By Simon Jessop
LONDON (Reuters) - Britain's investment industry has called on the G7 to do more to improve corporate reporting on climate-related risks, adding to pressure from the financial sector as it grapples with the uncertainties and escalating costs of extreme weather events.
In a letter to the Group of Seven leading economies ahead of a meeting this week, the Investment Association (IA) said it was vital that climate risks were disclosed by companies so asset managers can help them in the transition to a low-carbon economy.
Specifically, the IA said it wanted the G7 to help the International Financial Reporting Standards Foundation move "at pace" to develop sustainability reporting standards, and increased regulatory cooperation to implement them.
National regulators should also commit to implementing economy-wide reporting by companies using the Task Force on Climate-related Financial Disclosures framework, which guides companies on what information to disclose to the market.
International standards also needed to be agreed on the issuance of so-called "green gilts", or sovereign debt issued to help fund environmentally friendly projects, said the IA, which represents the UK's 8.5 trillion pounds ($12 trillion) investment industry including the likes of BlackRock (NYSE:BLK) and Standard Life (LON:SLA) Aberdeen.
Lastly, governments needed to set out the pathways that each sector needed to take if it wanted to meet the terms of the Paris Agreement on climate, which aims to cap the increase in global temperatures by mid-century.
"The meeting of the G7 is a prime opportunity for the world’s largest economies to take a coordinated, global approach to tackling climate change," said Chris Cummings, chief executive of the Investment Association.
"Ensuring high-quality and comparable data on the risks that companies face from climate change is key to achieving this and meeting the net zero targets."
Officials from the G7 - comprising the United States, Japan, Britain, Germany, France, Italy and Canada - are set to meet in London on June 4-5.