UN talks 'must listen to investors'

INVESTORS have called for the United Nations to take their views into account during the latest round of climate change talks in Cancun.

Two weeks of international talks in the Mexican beach resort are unlikely to produce a firm decision on emissions targets for developed countries after 2012, when the present round of the Kyoto Protocol ends.

One way governments could implement such targets is through carbon taxes or cap and trade schemes, which impose a cost on carbon emissions from burning fossil fuels. Investors say that would tilt the balance in favour of clean energy.

David Russell, head of responsible investment at the UK's Universities Superannuation Scheme, said: "Having an effective global cost of carbon will drive these markets."

Investors are hoping for progress at the next meeting in South Africa at the end of 2011 and complain that governments pay insufficient attention to them in the UN process.

Russell said: "It's about setting a binding target - which won't happen at this conference, hopefully at the next - with a continuation of the Kyoto process, which includes cap and trade globally. It isn't going to happen in the short term."

The UN climate talks barely engage business directly, instead bringing together government delegates from nearly 200 countries. Business and other observer groups meet on the fringes.

Russell added: "The current process is set up so that it's a policymaker-to-policymaker discussion with very little input either from the business or investment community.

"As providers of capital we have our own requirements on what we need from policy."