Progress made in Copenhagen at the climate talks has been welcomed by the Institutional Investors Group on Climate Change (IIGCC), although firm and binding guidelines are still a must by the end of 2010.

The forum for collaboration on climate change for European investors, which represents €4trn in assets, also reiterated the need to maintain pressure for policy changes at domestic and regional levels.

"The momentum for greater action on climate change centred on Copenhagen and the progress made by individual countries should be viewed positively," commented Peter Dunscombe, chairman of IIGCC. "However, global decision-makers must ensure that this same momentum is not now lost. We urge them to work quickly to agree a legally-binding global framework which will kick start the development of a fully functioning international carbon market and provide a context for alternative financing mechanisms. This is an important catalyst to mobilise the assets of those who want to invest in environmental change."

World leaders, the IIGCC said, should agree on binding emission reduction targets and also press for strong domestic action by governments. The progress on finance for developing countries has been welcomed, although the group added that private sector investment remains a critical component to resolving the climate challenge.

"As policymakers hammer out a firm framework next year, it is also important that any solutions scale up flows of private money to complement public sector funding, particularly to developing countries," concluded Dunscombe.

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