A practical guide: How non-profits (and schools, universities, churches, foundations) can multiply their effectiveness with responsible investment strategies that address climate change
We've just published an article on the Daily Maverick explaining how non-profits can multiply their impacts by ensuring that they are not directly or indirectly (via funders) invested in companies making unduly large contributions to environmental and social damage, especially climate breakdown.But how do you actually do this? Here's a practical guide to action.
Learn about the issue of climate and ecological breakdown, how it is linked to inequality, and impacts the people you’re trying to support and assist through your work – and how it affects you (more than you think).
Find out where your money comes from, and how much of it comes from corporations causing climate change.
Engage your stakeholders. Talk to them about the issue. Ensure they support the actions you need to take.
If you have endowed/invested funds, challenge your asset managers to disclose the carbon footprint of your portfolios and explain how they’re fully addressing climate risk. (Hint: they’ll tell you they are, and they almost certainly aren’t – yet.)
If you receive funds from donors, ask them to engage with their asset managers on these issues.
Insist that investee companies honour human rights AND align their business strategies with climate goals. (E.g., Sasol must cut carbon emissions 50% over the next 11 years.)
Look for the opportunities! Wind and solar energy are emerging industries; coal is in a death spiral.
Develop a strategy. Decide where you will divest and where you will engage – and how long you will engage before divesting.
If you have a staff pension fund, consider climate impacts on this fund. Pension funds with fossil fuel investments face massive regulatory and technological risks, and climate-related economic damage. Pension fund trustees are now legally required to assess climate-related risk to portfolios. Have your trustees done this?
Consider investing a judicious portion of your portfolio in a pioneer responsible investment fund. Naviga Solutions has floated the institutional BCI Select ESG Equity Fund that would exclude the most environmentally and socially destructive companies, and weight others according to their impacts, with low fees and portfolio management by Investec.
Register for Financing the Future: The Global Climate Divest-Invest Summit from 10–11 September 2019 in Cape Town.
