Nordea Investment Management, part of the Nordic-based financial services group Nordea Bank, has begun tracking the carbon footprint of its funds. The move comes in response to increased investor demand for information and transparency around climate risks. There have also been calls from across academia, governments, and NGOs for increased investor awareness on the long-term risks of investment in companies that are dependent on fossil fuels. The company, with some €130bn of assets under management, began the process of measuring the carbon footprint of several of its large, mainstream, equity funds, as well as its funds that make investment decisions based on environmental, social and governance (ESG) factors last summer. Nordea’s head of corporate governance suggested this was only the start, stating, “if there is demand for this type of information in their portfolios and we have the ability to do it, we will.” (Financial Times*)
UK doctors vote to divest from fossil fuels
The British Medical Association (BMA), the representative body of UK doctors, will divest from fossil fuels and increase its investments in renewable energy. The motion passed with a significant majority at the BMA’s annual meeting last week. The organisation is the first of its kind to make such a move, although it is hoped that the decision will set a precedent for other bodies, both in the UK and internationally. The decision was made citing the “immediate and grave threats posed by climate change”. With climate change being seen as a major, if not the greatest threat to human health of the 21st century, the divestment is seen as analogous to divestment from similarly health-harming industries such as tobacco. Health and campaigning charities have welcomed the decision. Medact, the Climate and Health Council and Healthy Planet UK, who campaigned for the decision, are now seeking to engage other medical organisations, such as the Royal Colleges, to follow the BMA’s example. (Edie)
Environment
Indonesia needs $5bn in aid to cut CO2 from deforestation
According to Reducing Emissions From Deforestation and Forest Degradation (REDD+), the Indonesian agency set up to protect rainforests and peatlands, Indonesia will need another $5bn in foreign aid in order to meet emissions reduction targets. Due to its deforestation, Indonesia is currently ranked as the world’s third largest emitter of carbon. The country has set reduction targets of 26% based on its own funds and as far as 41% depending on the level of international aid. At present REDD+ programmes are sponsored by the United Nations and receive funding from the Norwegian government. REDD+ programmes award credits for each ton of emissions prevented through the saving of peatlands or forestry. The funding deficit is in part attributed to a lack of law enforcement around deforestation and peatland burning, as well as a lack of a uniform methodology for measuring emissions saved. (Bloomberg)
Employees
All Nestlé contractors to receive the living wage
Nestlé, the world’s largest food company, is the first major manufacturer to commit to paying the living wage to all its staff. The food giant currently pays the living wage or more to all its 8000 UK permanent employees; by the end of 2017 this will be extended to some 800 contractors too. The living wage is the amount an individual needs to earn in order to cover a basic standard of living (£8.80 an hour in London and £7.65 in the rest of the UK). The move has been well received, and led to calls for other companies to follow suit. The Living Wage Foundation’s director Rhys Moore stated, “we hope that the leadership they have shown will encourage others in this industry”, whilst the GMB union said “this shows once and for all that if one leading manufacturer can pay a living wage to all…then many more are able to do so.” Fiona Kendrick, Chief Executive of Nestlé UK&I said the company was proud of its decision saying it was the right thing to do not just for its employees but for their communities as well. (BBC News)
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