U.K. institutional investors controlling about £850 billion ($1.6 trillion) in assets signed a statement to incorporate climate change risks into their investment strategies, according to an announcement today by the Institutional Investors Group on Climate Change.
The Investor Statement on Climate Change called on pension funds to consider global warming and other environmental issues when selecting managers, which provides an incentive to managers to invest in ways that minimize detrimental environmental impact. Money managers are encouraged to steer the companies in which they invest toward better environmental policies. Other goals involve working with governments on targets for reducing greenhouse gas emissions and legislation to encourage investments in low-carbon energy.
"The role of asset owners is significant as we have the power and wherewithal to use climate change considerations when appointing those who manage our assets," Peter Scales, group chairman, said in a prepared release. Mr. Scales is CEO of the £3.5 billion London Pensions Fund Authority Pension Fund.
Other pension funds among the 15 institutions signing the statement include the £26 billion Universities Superannuation Scheme; the £7.4 billion Greater Manchester Pension Fund; and the £7 billion West Midlands Pension Plan. Money managers include Hermes Pensions Management, which manages the £36 billion BT Pension Scheme; F&C Asset Management; BNP Paribas Asset Management; and Insight Investment.