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Leading asset managers target transparency failures over environmental impacts

A group of 88 investors with almost $10trn (£7.95trn) in assets are targeting companies over their environmental impact transparency.

The investors include HSBC Global asset Management, Investec Asset Management and Candriam and is part of CDP’s 2019 non-disclosure campaign.

CDP is an international non-profit which aims to drive companies and governments to reduce greenhouse gas emissions, safeguard water resources and protect forests.

They are are targeting a total 707 companies with a market cap of $15.3trn (£12.2trn) across 46 countries for not sufficiently reporting their climate change, deforestation and water security data.

Companies targeted include  Exxon Mobil, BP, Amazon, Volvo and Quantas Airways. They have each been targeted because of their high environmental impact and “lack of transparency” of issues to date.

Candriam chief investment officer Vincent Hamelink says: “It is of the greatest importance that companies disclose and manage their environmental impact and we are proud to be taking a leading role as a loyal supporter of CDP for the 15th consecutive year. Collaborative initiatives are crucial for effective impact, as they ensure a consistent message from asset owners. These will continue to increase in importance, as the financial community’s environmental, social and governance awareness gains momentum.”

The non-disclosure campaign is in its fourth year but this is the first time it has reported publicly. It says companies targeted in last year’s campaign were more than twice as likely to disclose as those which were not.

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CDP’s global director of investor initiatives Emily Kreps says companies must disclose their role in addressing the climate crisis. “We know that climate change, water security and deforestation present material risks to investments, but these risks cannot be managed without proper information.

“While some companies may say they already disclose in their own sustainability reports – that is not enough on its own. Investors and the wider market need transparency in the form of consistent, comparable and relevant metrics that are easy to access, compare and benchmark.

“And as for companies that say their investors do not care about these issues, this campaign demonstrates that is simply not the case. Investors are asking for this information and using it – for corporate engagement, selecting stocks and building investment products. 7,000 companies are already disclosing through CDP and providing the market with the information it is asking for – the ‘vow of silence’ from non-disclosing companies cannot go on.”

The group of investors will be engaging with companies over the summer while CDP’s disclosure system is open. Companies will be asked to submit their response to investors via the CDP online response system.

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