Big investors guilty of climate greenwash, says new report

By John Parnell

The world’s largest investment funds are ignoring climate change and guilty of greenwash, according to a new report.

The first ever Index published by the Asset Owner’s Disclosure Project (AODP) found that a third of the 314 funds it received data from had no information available on what they were doing to account for climate change in their investments.

Many of those that did have public information on climate change, could not demonstrate that these claims had been transferred to their investment decisions, leaving the report to conclude that these were simply “greenwash”.

The AODP report scored one third of the funds it assessed a zero for a failure to make low carbon investments and to account for climate change risk. (Flickr/©John B G)

Those questioned include some of the world’s largest pensions funds, sovereign wealth funds and insurance firms, many holding the savings of regular citizens.

“We applaud the efforts of the leaders but even many of those provide scant information to us as stakeholders to allow us to see how they are managing our future,” said Sharan Burrow, AODP board member and General Secretary of the International Trade Union Confederation (ITUC).

“As for the laggards, working people should expect more from the people who they have trusted with their retirement savings to manage the long term. These funds need to wake up to the scale of climate risk but also members need to start applying pressure to drive the change,” she added.

The index assessed a number of criteria including the funds’ scale of low carbon investment, their transparency and the level of risk management assigned to climate issues.

Funds are required to protect the assets of their investors under “fiduciary duty”.

More progressive coalitions of investors, such as the International Investor’s Group on Climate Change (IIGCC), have publicly stated that to ignore climate risk, is to breach this trust with those whose money is under management.

AODP asked 1000 funds, worth $60 trillion, to take part with the 314 respondents representing 64 different countries.

The full index and the accompanying report are available on the AODP website.

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