As You Sow have today launched an all new free tool for people to find out if climate risk threatens their pensions and investments, fossilfreefunds.org. The tool combines financial data from Morningstar and carbon footprinting data from South Pole Group and YourSRI.
In the largest ever analysis of its kind, they calculated the carbon footprints of over 8,500 commonly held global mutual funds and exchange-traded funds, worth more than £9 trillion, to create an online tool which allows people to compare the investments of private equity funds, hedge funds and pensions.
The study covers more than 1,300 UK funds worth over £600 billion, revealing sharp contrasts. The £11.7 billion Invesco Perpetual High Income Fund, the biggest UK fund in the study, is three times more exposed to carbon than the £7.9 billion Stewart Investors Asia Pacific Leaders Fund, the fourth biggest. The £5.6 billion M&G Global Dividend Fund, the ninth biggest, is seven times more exposed.
The UK’s cleanest fund is the £221 million Royal London Sustainable World Trust, a fossil free fund with a relative carbon footprint (carbon emissions divided by fund value) 175 times lower than the dirtiest sector-diversified fund in the dataset, the £102 million BlackRock Emerging Europe.
Mark Carney, Governor of the Bank of England and chairman of the international Financial Stability Board, put climate risk on the mainstream financial agenda when he warned that action to meet global climate change targets could leave fossil fuels and other high-carbon investments as worthless stranded assets, threatening investors with huge losses. The FSB has set up a task force to recommend how asset owners and the companies they invest in should report the potential impact of climate change on their bottom line.
Measuring a company’s carbon emissions is a critical way to understand the climate risk in your investments.
The free online tool was created by shareholder advocacy nonprofit As You Sow and is available at FossilFreeFunds.org . The analysis uses data provided by global sustainability solutions provider South Pole Group, and yourSRI .com , a leading climate impact data analyst for responsible investments. The data on the website is refreshed monthly, using the most recently available fund holdings data from Morningstar.
“Transparency leads to transformation.” said Andrew Behar, CEO of As You Sow. “Measuring a company’s carbon emissions is a critical way to understand the climate risk in your investments. We have aggregated this data for all of the companies embedded in the 8,500 most commonly held global mutual funds and ETFs. This tool enables every investor to answer the question, ‘Am I investing in my own destruction or the clean energy future?’”