Eleven financial industry associations have released a list of measures they support to help the U.S. transition to a low-carbon economy, including putting a price tag on carbon emissions.

The new report by the U.S. Climate Finance Working Group spells out 10 principles the financial services sector believes should form the framework for long-term climate policy. President Joe Biden has pledged to make climate change a top priority, although his actions so far have met with mixed reactions from a business community that supports addressing the problem but is wary of new regulation.

"Climate change is one of the great global challenges of our time, and the financial services industry has a key role to play in financing the transition to a sustainable economy," said Tim Adams, CEO of the Institute of International Finance. "We hope the policy framework created by these principles will catalyze a pragmatic transition to a more sustainable, more inclusive, low-carbon economy."

The 10 principles are:

• Establish science-based climate policy goals that align with the Paris Agreement
• Increase and strengthen U.S. international engagement
• Provide clear long-term policy signals that foster innovation in financial services
• Price carbon and leverage the power of markets
• Minimize costs and support jobs in the transition
• Foster international harmonization of taxonomies, data standards and metrics
• Promote more robust climate disclosure and international standards
• Ensure climate-related financial regulation is risk-based
• Build capacity on climate risk modeling and scenario analysis
• Strengthen post-disaster recovery, risk mitigation and adaptation

Carbon pricing in particular is often touted as a free-market solution to address climate change but has failed to gain much political traction, failing three times at the polls in Washington state when the issue was put directly to voters. Still, the concept has proponents on both sides of the political spectrum.

In addition to IIF, the working group members include the American Bankers Association, Bank Policy Institute, CRE Finance Council, Financial Services Forum, Futures Industry Association, International Capital Market Association, Institute of International Bankers, International Swaps and Derivatives Association, Investment Company Institute, and Securities Industry and Financial Markets Association.

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