UK investors have a' poor' attitude to involvement with climate change

... Credit :
Shadrach   in Alternatives

Last updated: 17 January 2020, 09:07 GMT

According to a new survey, the attitude of UK investment managers towards climate change is' worryingly poor.'

LCP's Responsible Investment Survey finds that only about half (52 percent) of the managers polled could give a' reasonably detailed description' of their approach to climate-change engagement.

Therefore, with an investor group, regulator or policy maker, only 54 percent could provide a good example of recent engagement on this topic.

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Given the widespread pressure on institutions to respond to increasing demands for a faster transition to a net zero-carbon economy, this is hardly a majority,' write the writers of the study.

The survey, which is conducted every two years, collected the views of 137 investment managers. According to LCP, the respondents include most major UK institutional investors.

The findings come as the buy side faces rising pressure to take climate change as a critical part of investment decisions.

Larry Fink, CEO of BlackRock, said in his annual letter to CEOs earlier this week that climate change has become a defining factor in the long-term prospects of businesses.

Furthermore, the new UK Stewardship Code 2020 calls for asset managers and owners to report on their ESG application across all asset classes–including on climate change. Under the new code, investors will need to provide case studies of their actions to show that they are taking the requirements seriously.

While the respondents to the LCP survey struggled to explain their approach to engagement with climate change, there are other findings pointing to a growing focus on responsible investment.

For example, 88% of respondents claim they are signatories to the United Nations Principles for Responsible Investment, up from 78% in 2018 and 66% in 2016. In addition, 81 per cent of respondents say their company has board-level responsibility for responsible investment, compared to just 34 per cent in 2018.