Friends of the Earth, together with the non-profit organisation As You Sow, which promotes environmental and social corporate responsibility through shareholder advocacy (Ethical Financial Planning).
have created a free online database enabling individual investors to determine for the first time their links to tropical deforestation and land grabs
The new transparency tool, which highlights socially responsible funds that carefully consider issues like the environment and human rights, empowers investors to demand “deforestation-free investment’ options and responsible policies from major fund families and workplace retirement plan managers.
Currently spanning some 6,500 global mutual funds, the search platform will be expanded to include all market drivers of deforestation (Ethical Financial Planning).
Today, c.10% of the global palm oil industry is financed by equity investors, including many mutual funds. As of June 2016, US mutual funds had a net investment exposure exceeding $5 billion (c.$4.5 bn/3.8bn) in palm oil producers.
Palm oil production, a % 61bn industry in 2014, is the fastest growing cause of rainforest deforestation destruction today and the second biggest driver of climate change after the burning of fossil fuels.
Processed palm oil is used today in over half of the packaged consumer products on supermarket shelves (Ethical Financial Planning).
Andrew Bahar, CEO of As you Sow, said “investments in palm oil are embedded in our pension funds, IRAs, and 401(k) (In the US) but most of us are not even aware of it. This web tool empowers investors to know exactly what they own so that they can pressure fund managers to implement sustainable investment policies and find investment options that support a forest-friendly future.
A separate Friends of the Earth report, Are you Invested in Exploitation?, accompanying the database, outlines ways institutional asset managers can take greater responsibility for the social and environmental impacts of their investments (Ethical Financial Planning).
(Ethical Performance Journal, 2016)
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