Hub firm leads pact on global warming

WASHINGTON -- In another major push by businesses for federal action on global warming, dozens of institutional investors managing a combined $4 trillion in assets -- led by a Boston investment firm specializing in environmental issues -- yesterday urged Congress to draft and pass strict laws to curb greenhouse gas emissions.

The agreement, signed by 65 investor groups and financial companies, called for federal legislation that would reduce heat-trapping emissions of carbon dioxide 60 to 90 percent by 2050, compared to 1990 levels. The draft grew out of talks initiated more than six months ago by the Boston-based Ceres group, a coalition of investors and environmental groups that has done extensive work on global warming issues.

"What businesses need to move forward is a mandatory policy that finally will address the global financial risk of climate change," Mindy S. Lubber , Ceres president, said in an interview. "It's very hard for businesses to act without certainty."

To fully develop the alternative energy industry and spur investment in technologies that reduce pollution from fossil fuels, Lubbers said, Congress needs to mandate limits on carbon dioxide emissions and establish penalties for any company that exceeds those limits. "That's when the new innovators and the new technologies are going to come out," said Lubbers.

Ceres is a 17-year-old non profit network of investors, environmental organizations, and other public interest groups working with companies and investors on issues such as climate change.

The Bush administration, which has acknowledged that human activity contributes to global warming, has fought setting such emission caps, saying that it would hamper businesses and drag down the economy. The administration has long favored a voluntary system of reducing emissions, but as many as a dozen bills now before Congress call for some type of carbon dioxide limits; congressional leaders hope to have a bill later this year.

In January, several large corporations -- including DuPont, Alcoa, and General Electric -- said they favored strict limits on carbon dioxide emissions.

In a news conference yesterday, the list of those joining that call included Merrill Lynch, Calvert, Allianz SE , BP America, and California Public Employees' Retirement System , a state pension investment group. Others from New England include the state treasurers of Vermont, Connecticut, and Maine; utilities National Grid and Green Mountain Power; investors Boston Common Asset Management, Walden Asset Management, and Trillium Asset Management; and Green Mountain Coffee.

Allianz, which manages $1.6 trillion in assets, believes "it is essential to put a price tag on carbon, thereby enabling market mechanisms to drive emissions reductions and climate protection," said Joachim Faber , a member of the company's governing board.

Vermont's state treasurer, Jeb Spaulding who oversees $3 billion in assets in three pension funds, said he signed onto the initiative to "look out for the financial interests and future of the state of Vermont.

"The issue of climate change has a substantial impact on the future economy of Vermont, whether it be in the recreational or agricultural industries," Spaulding said. "If you look into the future, global warming poses a substantial risk."

Spaulding said he believes the actions taken by financial groups such as Merrill Lynch and DuPont showed that legislation to tackle global warming "has mainstream support" that should prompt Congress and the White House to act.

Representative Edward J. Markey, a Malden Democrat and chairman of the House Select Committee on Energy Independence and Global Warming , said in a statement that yesterday's announcement by investors was a "major welcome development."

"The administration's refusal to step up is unsustainable and is prolonging great uncertainty for capital investment leaders trying to make long-term decisions that are crucial to our economy," Markey said.

Senator Bernie Sanders, an Independent from Vermont who has introduced a global warming bill calling for 80 percent reduction in greenhouse gas emissions by 2050, said the Bush administration has long ignored scientists' warnings on climate change but added, "I hope the president will finally pay attention now [that] the growing chorus of concern includes corporate America."

John Donnelly can be reached at donnelly@globe.com.