Only 30 of Europe’s 100 biggest investors, mainly made up of pension funds, insurance companies and the sovereign wealth funds of five countries (Denmark, Netherlands, Sweden, Finland and Norway) have already implemented changes to bring their public equity portfolio more into line with the Paris climate agreement but many are still investing too heavily in coal, states a report published by WWF on 4 July.
“Ensuring capital is invested in companies that contribute to a climate-safe future is key to reaching the Paris Agreement targets, reducing climate-related financial risks and maximising returns. Some asset owners are showing leadership, but more needs to be done to reallocate investments from coal to renewable power”, commented Sebastien Godinot, Economist at WWF European Policy Office.
The is based on the data disclosed by 30 major asset owners – pension funds, insurance companies and sovereign wealth funds in 12 countries (Belgium, Denmark, Finland, France, Germany, Italy, Netherlands, Sweden, United Kingdom, Norway and Switzerland) representing USD$2.5 trillion in total assets. WWF contacted 80 asset owners worth USD$13 trillion in total. The report has deliberately been published ahead of the G20 summit in Hamburg (7-8 July) which, WWF hopes, will address the issue of the lack of disclosure on climate risk.
The report shows that most of the 30 major investors who responded have cut funding to coal mining. However, many are investing too much in coal power and still lagging behind on renewable power.
WWF is critical that too many asset holders are not disclosing how their capital investments are aligned with the Paris Agreement target of keeping the average global temperature increase to well below 2 degrees Celsius (the less ambitious target since the Paris Agreement also targets a 1.5 degree rise in temperature). (Original version in French by Aminata Niang)