GLOBAL – European investors have expressed disappointment with the decision to delay an agreement on climate finance and urged action at a domestic level in response to the conclusion of the UN Climate Change conference in Doha.

Stephanie Pfeifer, executive director of the Institutional Investors Group on Climate Change (IIGCC), which represents European investors with more than $10trn (€7.8trn) in assets, said: "With the most recent evidence suggesting long-term average temperatures will rise significantly beyond previous forecasts, delaying a decision on climate finance now shows a lack of urgency and threatens to have real economic impacts in the future.

"Reliable, long-term policy frameworks which help scale up private capital alongside government finance are essential to tackle climate change. In the absence of urgent international action on climate finance, progress at a domestic level becomes even more crucial."

In the UK, an Aviva Investors survey of global equity and fixed income managers with combined assets under management of circa £4trn (€5trn) shows that 84% consider environmental, social and governance (ESG) factors as part of their investment process and actively vote on holdings.

Sixty-one percent also publicly disclose their voting record.

Ian Aylward, co-head of multi-manager at Aviva Investors, said: "We are increasingly seeing these issues crossing over into 'mainstream' fund management, with ESG performance starting to be assessed in actively managed funds."

The survey revealed that 90% of managers consider ESG issues to be important to clients and consultants, with 79% saying these are likely to be incorporated in all mainstream funds in the future.

Importantly, 72% believe there is a link between a company's ESG performance and total returns for investors.

Also in the UK, the Sustainable Investment and Finance Association (UKSIF) has warned that news of the missed UK debt target in the chancellor's Autumn Statement could mute the Green Investment Bank's ability to boost investment in the low carbon economy.

Caroline Escott, UKSIF programme director and head of government relations, said: "[The] Autumn Statement seemed like a missed opportunity to boost green growth. We were particularly disappointed that any boost to the Green Investment Bank's borrowing powers will apparently be delayed as a result of the new debt forecasts."

In other news, civil society groups have said major farmland investors such as banks and pension funds must stop facilitating land grabs.

They warned that pension funds and banks must ensure they do not fund risky investments that threaten the livelihoods and food sovereignty of countless local communities.

Kirtana Chandrasekaran, Friends of the Earth international food sovereignty programme co-ordinator, said: "Unfortunately, private investment in farmland may be seen by many as low risk and positive for developing countries.

"Yet they are often a disaster for local communities and the environment. Legal uncertainty and community opposition means most farmland investments are also risky for investors.

"Major investors such as banks and pension funds need to urgently investigate their investment portfolios and stop funding land grabs."
 
Since 2008, rising financial investments in land have contributed to more than 200m hectares of land being taken from small farmers, fisherfolk and other rural communities, according to Friends of the Earth.

Topics