Investors to Biz: You Say You Support Climate Goals, but You

Two hundred investors with a combined $6.5 trillion in assets under management are calling on 47 of the largest US publicly traded corporations to align their climate lobbying with the goals of the Paris Agreement. In a letter sent to each of the companies, the investors warn that lobbying activities that are inconsistent with meeting climate goals are an investment risk. The letter also states that while many companies publicly state support for policies to stem global warming, some of them finance trade associations that lobby against those same policies.

We are convinced that unabated climate change will nega Betting Number Data tively impact our clients, plan beneficiaries, and the value of our portfolios,” wrote the investors in a letter sent to each company.

Investors are accustomed to managing risk and measuring performance in terms of risk-adjusted returns, but climate change presents a very different challenge. Traditional techniques for managing these risks to investor portfolios “will only take us so far,” the letter continues.





What Risks, Exactly?
The letter outlines the specific risks the investors believe they are facing when it comes to climate change. These include:

Regulatory risks: Delay in action now will likely result in the need for stronger and more drastic regulatory interventions later, leading to much higher costs for companies.
Systemic economic risks: Delay in the implementation of the Paris Agreement increases the physical risks of climate change which elevates uncertainty and volatility in our portfolios and poses a systemic risk to global economic stability.
Reputational and legal risks: Companies may face backlash from their consumers, investors or other stakeholders if they, or the organizations they support, are seen to be delaying or blocking effective climate policy.