Long gone are the days where only a few “socially responsible” investors focused on sustainability issues – today, some of the country’s largest asset managers (e.g., Vanguard, BlackRock Inc., Fidelity Investments, State Street Global Advisors) and public pension funds (CalPERS, CalSTRS, NYS funds) are publicly advocating greater corporate accountability in the ESG realm, perhaps most notably in the area of climate change. BlackRock, the world’s largest asset manager, recently sent “open letters” to 120 companies in the energy, transportation and industrial sectors urging improved disclosure of “’material climate risk inherent in their business operations’” in accordance with the recommendations of the Financial Stability Board’s Task Force on Climate-related Financial Disclosures (TCFD)
It will utilise cooperation with standard-setting bodies, as well as other international authorities and organisations to attain its objectives. Digital assets and initial coin offerings (ICOs) also attracted the focus of the European Commission
The IMA is a big supporter of sustainability reporting/ integrated reporting as discussed in this memo on the topic to the The International Integrated Reporting Council ( IIRC ): “The international market place is increasingly paying more attention to non-financial information about organizations to better understand their performance, value and reputation – all one need do is look to the trillions in assets under management of the signatories of the UN Principles of Responsible Investing (UNPRI), or for that matter, to the number of private equity, venture capital and hedge funds dedicating significant portfolio allocations to companies that measure and report on their operations as well as their environmental, social and governance (ESG) practices
Speaking at the summit -- Mark Carney reiterated previous warnings that the global financial system could be at risk from both physical climate impacts and a 'carbon bubble' where efforts to de-carbonize leave carbon intensive assets stranded. He said markets could experience a "climate Minsky moment", referencing the work of economist Hyman Minsky who has studied how banks failed to predict the 2008 financial crisis that disrupted the world economic growth