Skip to main content
The Actuary: The magazine of the Institute and Faculty of Actuaries - return to the homepage Logo of The Actuary website
  • Search
  • Visit The Actuary Magazine on Facebook
  • Visit The Actuary Magazine on LinkedIn
  • Visit @TheActuaryMag on Twitter
Visit the website of the Institute and Faculty of Actuaries Logo of the Institute and Faculty of Actuaries

Main navigation

  • News
  • Features
    • General Features
    • Interviews
    • Students
    • Opinion
  • Topics
  • Knowledge
    • Business Skills
    • Careers
    • Events
    • Predictions by The Actuary
    • Whitepapers
    • Moody's - Climate Risk Insurers series
    • Webinars
    • Podcasts
  • Jobs
  • IFoA
    • CEO Comment
    • IFoA News
    • People & Social News
    • President Comment
  • Archive
Quick links:
  • Home
  • Sections
  • News

Asset managers ignoring biodiversity loss

Open-access content Wednesday 17th June 2020

bumble-bee_istock-866707878.png

None of the world's 75 largest asset managers have a dedicated policy on biodiversity loss, despite the issue being ranked among the biggest challenges facing the world today.

That is according to two new reports from the responsible investment group ShareAction, which explore the various approaches taken by asset managers to biodiversity loss and climate change.

These show that just 11% of asset managers expect their investee firms to mitigate the negative impacts of their operations on the natural environment, while two-fifths still make no mention of climate change in their investment policies

ShareAction said there is a “critically underdeveloped” understanding of the systemic risks facing portfolios, with only around half of managers identifying examples of biodiversity-related risks to their investments,

This is despite the World Economic Forum ranking the challenge as one of the greatest risks facing society today, not only affecting business bottom lines, but also bringing ecosystems closer to destabilising tipping points.

“COVID-19 has shown that predicting the timing and the scale of shocks originating in the natural world is fraught with complexity,” said report author Krystyna Springer.

“Biodiversity loss is not a new, in-vogue ESG theme – it is closely intertwined with the climate crisis and threatens to compromise the efficacy of global climate action. If economic actors don’t start tackling it in the next few years, the damage will irreversible.”

The asset managers studied are responsible for assets worth more than half of the world’s total GDP. It was found that biodiversity loss is often included in generic ESG integration, but will little consideration.

Only 46% request better disclosure of the impacts of company value chains on biodiversity in their dialogue with investee firms, and just 49% discuss corporate strategy on biodiversity.

On the climate change front, ShareAction found that 39% of asset managers make no mention of climate change in their public investment policies, and only a small percentage make specific commitments relating to portfolio decarbonisation. 

For example, 84% have no policies to exclude coal companies from their investment portfolios, and 93% have no policies prohibiting investments in tar sands – one of the most carbon-intensive fuels.

Moreover, the researchers claim that large asset managers such as J.P. Morgan Asset Management and Goldman Sachs Asset Management generally vote against resolutions calling for transparency on corporate lobbying, despite claiming to support a low-carbon transition.

“The window of opportunity is closing rapidly as we enter a critical decade,” Springer continued.

“We need transparency and urgent and disciplined action by asset managers, asset owners, regulators and policymakers, for a fundamental shift towards a truly sustainable and resilient global financial system."

 

Author: Chris Seekings

Image credit: iStock

 

Also filed in
News
Topics
Investment
Environment
Global

You might also like...

Share
  • Twitter
  • Facebook
  • Linked in
  • Mail
  • Print

Latest Jobs

Environmental, Social and Governance- GI Actuary

England, London
£70000 - £170000 per annum
Reference
145888

Calling All Australian Actuaries

England, London
£50000 - £120000 per annum
Reference
145887

Calling all GI Actuaries looking to move into contracting

England, London
£700 - £1000 per day
Reference
145886
See all jobs »
 
 

Today's top reads

 
 

Sign up to our newsletter

News, jobs and updates

Sign up

Subscribe to The Actuary

Receive the print edition straight to your door

Subscribe
Spread-iPad-slantB-june.png

Topics

  • Data Science
  • Investment
  • Risk & ERM
  • Pensions
  • Environment
  • Soft skills
  • General Insurance
  • Regulation Standards
  • Health care
  • Technology
  • Reinsurance
  • Global
  • Life insurance
​
FOLLOW US
The Actuary on LinkedIn
@TheActuaryMag on Twitter
Facebook: The Actuary Magazine
CONTACT US
The Actuary
Tel: (+44) 020 7880 6200
​

IFoA

About IFoA
Become an actuary
IFoA Events
About membership

Information

Privacy Policy
Terms & Conditions
Cookie Policy
Think Green

Get in touch

Contact us
Advertise with us
Subscribe to The Actuary Magazine
Contribute

The Actuary Jobs

Actuarial job search
Pensions jobs
General insurance jobs
Solvency II jobs

© 2023 The Actuary. The Actuary is published on behalf of the Institute and Faculty of Actuaries by Redactive Publishing Limited. All rights reserved. Reproduction of any part is not allowed without written permission.

Redactive Media Group Ltd, 71-75 Shelton Street, London WC2H 9JQ