Pension funds are supposed to focus on the long-term with a natural investment perspective stretching decades. From this perspective their policies should keep a keen eye on the future of the planet. Although this should be common sense, research conducted by Asset Owners Disclosure Project (AODP), managed by BETTER FINANCE’s UK member ShareAction, shows that 90% of the 100 largest public pension funds have not aligned their portfolios with the 2°C warming target agreed at the 21st Conference of the Parties (COP21) held in Paris in December 2015.
If almost every State in the world has pledged to respect the Paris Agreement, it is not possible to say the same of pension funds: AODP explains that 87% of the assets of the funds taken into consideration for this study have not been assessed against climate-related risk such as storms, floods, heatwaves and hurricanes. These risks can harm not only savers’ retirement plans, by destroying properties and infrastructure and therefore undermining the value of the investments, but also their retirement itself. Who can enjoy a decent retirement when there is no planet left to enjoy?
Some good news comes from Europe though, as the AODP recently ranked public pension funds around the world according to their climate performance: European funds are leading with only two funds from the US in the top 10 and the rest from Europe
For further information please read on Euractive