The Pacific Rim business heads, gathered in Sydney for the Asia Pacific Economic Cooperation (APEC) summit, said governments should also provide more incentives for companies in invest in costly research and development of new technologies to help them reduce their carbon footprint.
At the moment, you can pollute for nothing ... so we are asking leaders to put in place a market structure which will put a price on pollution and motivate companies to change their behavior, Mark Johnson, head of the APEC Business Advisory Council, told a news conference.
Industry is responsible for around a quarter of all man-made greenhouse gas emissions and is under pressure to add to the fight against climate change.
Acknowledging that it was difficult to find common ground on the thorny issue given the various levels of development within APEC economies, Johnson said it would be up to individual countries to adopt their own systems.
Johnson, who is also the chairman of Australia's largest energy retailer AGL Energy Ltd, said the group had not recommended a price for carbon emissions as there is yet a framework in place within APEC economies.
It is urgent to get the framework in place. Probably, partly because most of us believe we have reached the tipping point in science and global warming is actually happening, he said.
Carbon trading first kicked off in Europe in 2005. Under the current EU Carbon scheme, big emitters such as power plants were given quotas on the amount of carbon dioxide they could emit, and a trading platform was also introduced to allow companies to buy or sell carbon credits.
Climate change is a major focus at the APEC meeting, with activist group World Wildlife Fund calling on APEC countries, which account for about 60 percent of the world's economy, to set binding targets on emission reductions in a post-2012 climate treaty.
Separately, Johnson said business heads were also disappointed that APEC leaders had failed to deliver an outcome on Doha talks and would pursue a free-trade zone within APEC should Doha fails.