The deal 195 nations finalized in December in Paris may be the most important climate agreement ever reached, but pockets of corporate leaders, financial regulators and money managers remember it for another reason: a shift in how the business community views global warming.

“For the first time, we’re seeing a genuinely changed landscape for the private sector,” said Edward Cameron, head of policy at We Mean Business, a group of investors and companies urging a shift from fossil fuels. “What we see now is growing momentum out of Paris.”

The business and financial community didn’t even have a serious presence at the previous five U.N. climate conferences, said Mindy Lubber, president of Ceres, the sustainable investment advocacy group. On a day when the National Oceanic and Atmospheric Administration declared the first three months of 2016 had been the hottest such months on record, Lubber said the Paris Agreement is “extraordinary” in its scope and vision.

“The fact that we are signing this particular deal should be marked as the world’s greatest start,” she said.

Representatives of more than 150 nations will sign the Paris Agreement in New York City tomorrow (see related story).

Hundreds of companies voiced their support for the Paris deal leading up to tomorrow’s ceremony, while blue-chip firms that spend millions of dollars on energy costs, and whose predecessors likely opposed climate regulations, now back carbon-cutting efforts.

Some corporations have even pledged to protect U.S. EPA’s keystone climate regulation against challenges in the courts (EnergyWire, April 1).

“What’s exciting to us is seeing how many companies are getting in the game,” said Michael Terrell, senior policy counsel for energy and sustainability at Google. This month, Google joined Inc., Apple Inc. and Microsoft Corp. in filing a legal brief in support of EPA’s Clean Power Plan.

Google, officially now called Alphabet Inc., committed to purchasing more than 2 gigawatts’ worth of renewable energy. That target would make the tech giant the largest purchaser of renewable energy worldwide that isn’t a utility, Terrell said.

“I think we’ve seen more momentum than we have ever before,” he said of the businesses backing climate regulation. “We have a strong commitment from the private sector.”

Industry stepping up

More than 100 companies—including brand-name firms like Hilton Worldwide Holdings Inc., HP Inc., Johnson & Johnson, L’Oreal SA’s American division and inc.—yesterday in a letter endorsed the Paris deal and U.S. EPA’s Clean Power Plan. The regulation was a critical component for U.S. negotiators to secure international support during the Paris talks.

“They are all speaking in the same voice,” Lubber said. These 110 companies “want low-carbon power” and stable energy supplies, she said.

In a separate supportive statement last week, more than 400 institutional investors together managing more than $24 trillion in assets urged governments to support the expansion of low-carbon fuel sources, establish “economically meaningful” carbon prices and craft plans to eliminate fossil fuel subsidies.

“The Paris Agreement is an historic breakthrough that delivered an unequivocal signal for investors,” they wrote.

“[The accord] provides the right framework to trigger substantial investment and thus keep the door open to a well-below 2 degrees pathway,” they added, referencing what is widely accepted to be the largest temperature increase possible without inciting catastrophic climate change.

A handful of energy-industry companies operating in the U.S. market—Berkshire Hathaway Energy, Calpine Corp., PG&E Corp., Rio Tinto PLC, Royal Dutch Shell PLC and Siemens AG among them—urged politicians to move swiftly to enforce the Paris Agreement, too.

A robustly implemented Paris deal would ease the world’s business community into an economy no longer reliant on fossil fuels, they said.

In the coming decades, humanity will “see Paris as the turning point between the carbon economy and the clean economy,” IKEA Chief Sustainability Officer Steve Howard said. “This was a systemic, global economywide effort to decarbonize.”

IKEA has long spoken of its efforts to cut energy use. The Swedish furniture maker is 70 percent of its way to its goal of powering all its operations with renewables by 2020. It aims to reuse or recycle 90 percent of its waste by 2020 and also sells solar panels in three markets. The company will add solar panel products to nine more markets in the next year and a half, Howard said.

“We’re looking deep into our supply chain,” he said, “to chase out every ton of carbon.”

Still, the task of mobilizing enough investment to curb climate change is daunting.

The World Bank said last year that the global economy must rouse $90 trillion for spending on infrastructure, energy and land-use projects to prevent global temperatures from climbing more than 2 degrees Celsius.

Critics blast ‘command and control’ regs

But some industry organizations aren’t keen on what international leaders hammered out in Paris.

“U.S. manufacturers believe in the spirit of the agreement reached in Paris to reduce and stabilize global GHG emissions,” said Ross Eisenberg, vice president of energy and resources policy at the National Association of Manufacturers, the industry’s largest trade group in the country.

“However, we continue to have great concerns over the domestic policies that have been and will be put into place to meet the commitments made in Paris,” he said. “Regulation or policy that is set by government should promote a competitive marketplace for manufacturers, which is our best weapon in the fight to prevent global climate change.”

In an emailed statement, the American Petroleum Institute said U.S. carbon dioxide emissions are “near 20-year” lows.

“This has occurred without command and control style regulatory interference,” API said. “Our success is driven, not by government mandate or legislative fiat, but through innovation, investment and entrepreneurial spirit.”

A U.S. Chamber of Commerce spokesman provided a link to a blog post by Stephen Eule, who works at the chamber, in which Eule said the U.S. climate pledges that American representatives made in Paris were unrealistic.

The chamber and the National Association of Manufacturers are both challenging the Clean Power Plan in court.

Industry interest still an uphill battle

Since the United Nations held the first Conference of the Parties to the U.N. Framework Convention on Climate Change in Berlin in 1995, climate change has developed into a subtle but persistent theme of economic regulators, financial experts and private-sector leaders.

Starting early last year, officials at the Bank of England gave speeches on the financial damages of climate change.

Within financial circles, only insurers have traditionally really worried about climate change risks, Mark Carney, the governor of the Bank of England, said recently at the World Bank.

“Delivery of COP 21 will truly change that,” he said.

Just one-third of “top companies” provide adequate disclosure of their climate risks. A private-sector group backed by the Group of 20 nations is trying to resolve that problem, but climate disclosure remains “fragmented and incomplete” (ClimateWire, April 4).

G-20 nations are also working to establish a bigger, more transparent green bond market this year, Carney said, telling listeners that the upside to such a pool of stable, steady-income assets would he tremendous.

Less than 1 percent of the roughly $100 trillion in fixed-income assets in institutional investors’ hands is “anything that would approximate a renewable or green finance,” he said. “So there’s plenty of capital.”

Carney continued: “What the financial sector needs is the push, the belief that that investment is going to take place in lower-carbon opportunities and then that expertise will come.”

The central bankers of France and Bangladesh, in the run-up to and shortly after the Paris summit, have warned that climate change should be monitored for economic hazards (ClimateWire, Jan. 15).

At Google and IKEA, which are in the vanguard of shifting money to low-emissions technologies, the decision is financially savvy, officials said.

Terrell of Google said powering electricity-hungry data centers with renewables guards against unexpected price spikes in fossil fuel costs. “Our business runs on energy,” he said.

At IKEA, Howard said, climate change has already left its mark—from extreme weather that has damaged cotton down its supply chain, flooding in India and Pakistan that disrupted supplies, too, and Superstorm Sandy, which cost the company $9 million in damage in Red Hook, Brooklyn.

Anirban Ghosh, chief sustainability officer at Mahindra & Mahindra, a $17 billion Indian conglomerate active in 10 sectors, said India is experiencing all-time low levels of water currently, following two years of record heat that claimed hundreds of lives.

“The pursuit of low-carbon paths must be relentless,” he said. Sustainability is no longer deemed a cost, Ghosh said, but instead is being viewed as an opportunity “from a rejuvenation perspective.”

Reprinted from Climatewire with permission from Environment & Energy Publishing, LLC., 202-628-6500