According to the European Asset Allocation Report, published by fund administration and research experts Mercer, despite a slight improvement since 2016, the vast majority of responding funds are “still not active” on climate issues.

With NASA stating that April 2017 was the second hottest since records began in 1880 (with 2016 the hottest), Mercer’s recent report has found that only 5% of 1,241 European pensions schemes have considered the investment risk posed by climate change.

As a result the consultancy has called for “more urgency from the industry “to address the issue.

The 2017 report – Mercer’s 15th edition – gathers information from 1,241 institutional investors across 13 countries, reflecting total assets of around €1.1 trillion.

As well as investment strategy information, the report tracks the drivers behind Environmental, Social and Corporate Governance (ESG) integration and two key areas within responsible investment: investor stewardship and active ownership rights and, secondly, the investment risks and opportunities posed by climate change.

‘Do a whole lot more’

Phil Edwards, Mercer’s global director of strategic research, said: “The report findings highlight the need for the industry as a whole to do more; it’s ironic that the pace of response to this enormous issue is best described as glacial, outside a small group of leading funds.

Full Content: International Investment

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