Investment Climate Impact Assessment

South Pole Group's Investment Climate Impact Assessment screens the investment portfolios of their clients (pension funds, portfolio managers, faith-based institutions) to determine their climate impact. It validates all greenhouse gas (GHG) emissions disclosed by each investee and adapts the data. For those companies not disclosing their GHG emissions, it approximates GHG emission data based on 800 carbon-specific subsectors. This activity has re-allocated millions of dollars from climate-harming investment to climate-friendly investment options. Large institutional investors send a signal to companies by divesting based on the activity’s analysis, which raises consumer and public awareness.

Fast facts:

This activity works within the European Union’s Climate Knowledge and Innovation Communities, a public-private innovation partnership focused on climate innovation to mitigate and adapt to climate change.
To date, the South Pole Group has helped screen over USD 200 billion of assets under management for their investment climate impact.
Due to this activity, first time investors are setting themselves de-carbonisation targets.

The problem

Climate change threatens the pensions, life insurances and long-term financial security of ordinary citizens. Rich and poor alike will suffer from the impacts of an ailing global economy, while marginalized groups such as women, the elderly and the disabled will likely find themselves even less able to draw on governments for much needed financial support.

The solution

To enable financial services companies to play a responsible role in mitigating climate change, this activity seeks to increase transparency regarding the climate impact of investment portfolios. By helping investors understand their climate-related risks and opportunities, this activity’s assessments can discourage investments in carbon-intensive sectors. These assessments encourage their clients to divest from companies with the highest exposure to fossil fuels, engage with companies to help improve their strategy for adapting to climate change and re-balance their portfolios to include more investments in climate-friendly sectors and technologies. All of these strategies help to send a clear signal to policy makers and the market that investors are taking climate change into consideration, thus paving the way to a more sustainable global economy.

Helping the planet

By discouraging investments in carbon-intense industries, this activity helps protect global communities from the adverse affects of climate change-, which include periods of prolonged droughts, stress on global agricultural systems and more frequent and severe natural disasters.

Helping people

The portfolio carbon impact assessments conducted by the South Pole Group helps clients re-align their portfolios with climate related risks and opportunities in mind. Economically, this helps to ensure the long-term health of the global economy while securing the financial assets of ordinary people.

Scaling Up

As investor awareness grows, this activity anticipates that 76.5 trillion assets under management could eventually be measured for their investment carbon footprint. South Pole Group’s online screening tools can be accessed by investors without limits, backed by the world’s largest database on company climate information. The Investment Climate Impact Assessment of South Pole Group has the potential to help redirect investment streams worth billions of USD in line with a two-degree warming scenario.