ShareAction has found that 87% of asset managers assessed for a new report have failed to meet even half of a set of key responsible investment standards, describing the lack of progress as “shocking”.
The world’s largest asset managers are failing to respond effectively to global climate and social crises, according to ShareAction, who say the industry is turning a blind eye to the destruction of the planet as progress stagnates on responsible investment.
ShareAction set 20 standards that asset managers are expected to achieve and found that just 10 out of 76 asset managers met more than half of them.
The fifth edition of Point of no returns report ranks 76 of the largest players in the market, who collectively oversee more than $80trn (€70trn) assets under management, on whether they meet achievable responsible investment standards.
Overall, the report found significant underperformance and stagnation in responsible investment practices among asset managers, with only a few demonstrating leadership.
Speaking to IPE, Matthew Collins, senior researcher at ShareAction, said the report’s key finding was the “shocking lack of progress”, pointing to a clear stagnation in progress across several responsible investment themes.
“The largest US asset managers, collectively managing a third of the assets surveyed, are among the poorest performers,” said Collins.
BlackRock, Vanguard, Fidelity, and State Street performed poorly, while APG and Robeco, performed better overall and could potentially serve as models, he added.
| Rank | Asset manager | Country | Region | Grade | Overal score |
|---|---|---|---|---|---|
| 1 | Robeco | Netherlands | Europe | A | 76 |
| 2 | APG Asset Management | Netherlands | Europe | A | 75 |
| 3 | AXA Investment Managers | France | Europe | B | 73 |
| 4 | BNP Paribas Asset Management | France | Europe | B | 69 |
| 5 | Aviva Investors | UK | Europe | B | 64 |
Other key findings
The report comes as the wider industry is faced with political pressures and an intensifying ESG backlash, particularly from the US administration. However, ShareAction’s research reveals that the slowdown in new commitments from asset managers predates this.
ShareAction identified only four asset managers with sufficiently strong fossil fuel policies across major fuel types, all based in Europe: APG Asset Management, Nordea Asset Management, Ofi Invest Asset Management and SEB Asset Management.
Furthermore, less than a third of asset managers have a restriction on all major controversial weapon types. Exceptions in firms’ policies mean that only six out of the 76 managers in ShareAction’s assessment can be reliably expected not to profit from the production of nuclear weapons.
Speaking of the action investors can take, Collins said: “Investors need to be having conversations with asset managers to ensure that they’re disclosing accurate, reliable information […] the ultimate tactic would be to take their money out of the managers who don’t respond well.”
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