Government policies need to change to enable investors to move away from companies with a high exposure to fossil fuels, a responsible investment leader believes.
Speaking to Money Management, following global protests ahead of the UN's climate summit in New York this week, Responsible Investment Association of Australasia chief executive, Simon O'Connor, said current policies were an "impediment" to green investment.
"Without a policy response it makes it very difficult for investment communities to actually shift in the way they think they should," he said.
"Getting the right policies in place is critical to enable investors to do what the scientists are saying needs to be done.
"Frankly we're missing the opportunity for capital to flow to lower carbon industries in Australia because of the policy settings here."
Meanwhile, AMP's chief economist, Shane Oliver, told the ABC's Lateline programme that Australia investors were missing out on the opportunity to invest in green businesses that he said were likely to provide higher returns, because of Government policy and public misperceptions of the potential of low carbon businesses.
"Australians are a bit sceptical about the damage pollution and other things might cause," he said.
"They're fearful that maybe if they invest along this path, they might end up with lower returns. I should point out though, the evidence actually goes the other way. If you invest on a sustainable basis the odds are you will end up with companies that are sustainable long-term and that will probably produce higher returns."
