Institutional investors demand corporate climate-change risk disclosure.

• Author: Prugh, Tom
• Position: Environmental Intelligence

Institutional investors think U.S. carbon-emitting corporations aren't doing enough to assess the business risks of climate change, and have begun pressuring the firms to act more vigorously.

Last July CERES, a coalition of investor and public-interest groups, commissioned a report on the performance of the 20 heaviest carbon emitters among U.S. corporations in disclosing the financial risks posed by climate change. The report profiled the top five emitters in the auto, electric power, and oil industries, plus Alcoa, DuPont, General Electric, IBM, and International Paper. The study concluded that while all the companies are beginning to measure their greenhouse gas emissions and most of the companies' boards of directors have held discussions on climate change, only 12 have reported their efforts in routine filings with the Securities and Exchange Commission (SEC) and fewer than half are projecting emission trends. "All companies profiled ... are taking some governance actions to respond to climate change," said the report, "but few have adopted comprehensive programs to treat this issue as an imminent financial and environmental threat."

A number of institutional investors believe that is not enough, and in November several major pension fund managers, state treasurers, and bankers--collectively representing more than $1 trillion in assets--convened the Institutional investors...