A new interactive guide has been launched to provide pension funds with the tools needed to ensure their investments are not driving deforestation worldwide.
The guide was created by Global Canopy in partnership with the Make My Money Matter campaign and SYSTEMIQ, and in close consultation with 12 pension funds.
Its online format provides different pathways for various investment approaches – allowing users to log in and access the guidance most relevant for the needs of their specific pension fund.
It provides practical steps and actions for funds to identify, address and eliminate deforestation risk and associated human rights abuses, as well as future-proof their investments.
This comes after research earlier this year found that £2 in every £10 individuals save into their pensions is linked to companies and financial institutions at high risk of deforestation, jeopardising many schemes’ commitments to achieve net-zero emissions.
“The pensions industry has a huge role to play in the transition to net zero, and to achieve a sustainable future worth retiring into, it’s crucial that deforestation is eliminated at pace," said Huw Davies, senior finance adviser at Make My Money Matter.
“We now need to see pension funds embrace this guidance, and set about the task of tackling deforestation with an urgency befitting the crisis that the world’s forests face.”
The guide builds on a financial sector roadmap for eliminating deforestation launched at COP26, which sets out six phases, from identifying and mapping deforestation and its associated human rights risks within portfolios, to setting a policy and engaging with asset managers, to eliminating deforestation from investments.
Make My Money Matter and Global Canopy are calling on all pension schemes to review and adopt the latest guidance, and to sign up to the Race to Zero commitment letter on eliminating agricultural commodity-driven deforestation from their investments by 2025.
Global Canopy’s executive director, Niki Mardas, said: “Ending tropical deforestation is an essential step in addressing the global climate challenge and pension funds can have tremendous influence in driving change.
“Pension holders are increasingly calling for deforestation-free pensions – after all, what’s the point of saving for a future on a dying planet?
“Savvy providers know this is where their future business lies, and our new guide provides the toolbox to tackle these risks. There should be no reason now for pension funds not to start taking action on this all-important issue today.”
Image credit: iStock
Author: Chris Seekings