UNEP FI Asset Management Working Group The - UNEP Finance ...

GLOBAL: UNEP report claims green investments 'are a
legal responsibility' (21/07/09)
Green investments are no longer just a luxury, but are now a legal responsibility, according to a new
report by the United Nations Environment Programme (UNEP) and a powerful group of asset
managers who control some $2 trillion in assets.
The 120-page publication argues that if investment consultants and others do not incorporate
environmental, social and governance (ESG) considerations into their services, they face ‘a very real
risk that they will be sued for negligence’.
It also stressed the central role that the world’s largest institutional investors – including pensions
funds, insurance companies, sovereign wealth funds and mutual funds – have in easing the transition to
a low-carbon and resource-efficient green economy.
UNEP Executive Director Achim Steiner said: ‘ESG issues are not peripheral but should be part of
mainstream investment decisions-making processes across the industry.’
He also noted that creative market mechanisms and other incentives can help to ensure that as
investors return to markets after the current financial turmoil ends, they will put their funds into a
greener economy and not the ‘brown economy of yesterday’.
The new report, titled ‘Fiduciary responsibility: legal and practical aspects of integrating
environmental, social and governance issues into institutional investment’, was produced by the Asset
Management Working Group of the UNEP Finance Initiative (UNEP FI), a partnership between the
agency and nearly 200 financial institutions around the world.
Lis Stedman
24