The global financial crisis presents a major opportunity to make rapid progress towards addressing climate change, according to former US vice president Al Gore.
"We are now seeing changes in the global environment that are far more serious than any that we have ever faced as a civilisation," he told delegates at the International Corporate Governance Network annual conference yesterday.
"We face a true global emergency, and that phrase sounds shrill to many ears and is resisted for a lot of reasons, but it is really important to respond not only to the crisis and to the danger of this emergency, but also to the opportunity that it represents.
"Truly it is not only the most serious crisis we've ever faced, it is the largest opportunity that we have ever faced."
In the transition towards a lower carbon economy, Gore said the finance and investment community can contribute by examining some long-held assumptions about how the investment market functions.
"We have seen the emergence over the last three decades of what is described as short termism," he said.
"Now if you manage a pension fund you have a fiduciary responsibility to match the performance of the assets to the long-term liabilities, and the long-term liabilities are derivative of the human life cycle."
The challenge therefore lies in taking a longer-term view and dispensing with the short-term incentive structures and short-term ways of thinking in finance, business, politics and culture, Gore said.
"Incentive structures have a very powerful effect on the management of companies when they make decisions about whether or not to shift to renewable energy, to become more efficient, to make investments that can reposition their firms to be more sustainable."
