Four pledges for one planet: The mallowstreet Climate Charter
Pardon the Interruption
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The Transition Pathway Initiative (TPI) report assessed 274 of the world’s highest-emitting publicly listed companies finding that 46% of them are not aligned to meeting the Paris Accord. Only 20 of those firms are on course to beat the 2 degree target, but who can put the pressure on them to change with the times?
It is very difficult in these times of market uncertainty, trade wars and Brexit fatigue to find yield, let alone maintain member satisfaction. It is understandable that looking at individual stock allocation may be at the bottom of the to-do list when considering which funds and investments to make during the due diligence process. It has, however, never been more important to do just that.
Major corporations will operate within the rules that nations set, but internationally, they might look for the cost-efficient solution over green to satisfy shareholders.
Utilising the power of capital, pension funds can have incredible sway over organisations if they use their influence to ask for more than just returns. Whether that is in exerting pressure directly on companies your fund invests in or on the asset managers and investment firms who look after parts of your portfolio, it is within the power of the trustee to make a real impact.
That is why we have been hugely excited by the trustees who helped forge the mallowstreet Climate Charter and those who have signed in their own personal capacity. The Climate Charter calls for trustees:
To ask, ’What is the impact on the climate?’ for each and every investment that is proposed;
to demand that the carbon impact of every investment is measured and reported on by asset managers and work actively and collaboratively to develop complete carbon measurement standards;
to insist that each investment manager actively engages with corporate boards underlying the investments, so that every company develops and discloses both a complete measure of their carbon impact and a clear business plan to transition to a low carbon future; and
to review, and ultimately recommend the termination of, any investment manager that fails to support and actively engage in stewarding the transition to a low carbon future.