There are increasing signs of a seismic shift in the response by business and finance to the threat of runaway climate change.

Just days after more than a thousand businesses pushed for policies setting a price on carbon emissions to encourage a shift to cleaner energy technologies, some of the world’s largest institutional investors have committed to act on the carbon intensity of their portfolios.

The investors, along with the UN-supported Principles for Responsible Investment (PRI), which represents more than $45tn in assets under management, have announced the creation of the Montreal Carbon Pledge, which makes a commitment to measure and publicly disclose the carbon footprint of their entire investments on an annual basis.

The PRI has ambitions for investors with a combined portfolio of $1tn to sign up ahead of the key global climate talks in Paris in December 2015, although this is still tiny when compared with the estimated total of more than $75tn in investable assets.

Initial signatories, which include US-based Calvert Investments and Calpers, Nordea of Sweden and the UK’s Joseph Rowntree Charitable Trust, have $850bn under management.

The pledge, agreed at the PRI’s annual meeting in Montreal, could be the key that unlocks the door to a shift towards investment in companies that are taking action on carbon. It is likely to put pressure on businesses that are not yet taking the issue seriously, especially the 22% of the largest 500 publicly listed companies that still fail to report their carbon emissions.

“We are proud to launch the Montreal Carbon Pledge, a commitment by investors to translate climate talk into walk,” said Fiona Reynolds, managing director of the PRI. “The first step to managing the long-term investment risks associated with climate change and carbon regulation is to measure them, and this initiative sets a clear path forward.”

The information on emissions will allow investment funds to set targets by being able to place the carbon intensity of their portfolios against a common benchmark.

Over 40 investors have in recent years been showing that it is possible to carbon footprint at least part of their portfolio. These include French public sector pension fund ERAFP, the Swedish national pension fund AP4, London Pensions Fund Authority (LPFA), the UK’s Environment Agency pension fund and the Australian not-for-profit superannuation fund, VicSuper.

VicSuper reported earlier this year that the total emissions of its listed equities investments were 15% more carbon efficient than the overall MSCI All Country World Index, while the ERAFP announced in March that its €15bn equity portfolio has a carbon footprint 19% smaller than the overall market.

Philippe Desfosss, CEO of ERAFP, said: “It is hard to dispute that carbon is a risk, so how can we fulfill our duty of trust if we don’t implement the systems necessary to assess this risk in order to reduce it.”

The announcement of the Montreal Carbon Pledge comes only days after the release of a new report (pdf) by non-profit CDP, which provides a financial case for investing in companies that are showing leadership on addressing climate change.

The study found that the S&P 500 companies that build sustainability into their core strategies are outperforming those that fail to show leadership.

Specifically, corporations that are actively managing and planning for climate change secure an 18% higher return on investment (ROI) than companies that aren’t – and 67% higher than companies who refuse to disclose their emissions.

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