Investors are targeting banks and policymakers in a bid to drive progress on ambitions to rein in deforestation and antimicrobial resistance (AMR).
In one initiative, the Institutional Investors Group on Climate Change (IIGCC) has teamed up with the Finance Sector Deforestation Action Initiative (FSDA) to formulate expectations for how banks should go about eliminating commodity-driven deforestation, conversion and associated human rights abuses in their lending and client engagement practices.
The expectations were developed to support investor engagement with banks on deforestation. They are based on the ideas that banks are uniquely positioned to tackle deforestation, and that deforestation poses financial risks to investors and banks at a system-level and an individual company level.
FSDA, which in 2024 appointed the IIGCC as secretariat, was formed in 2022 to implement a COP26 pledge by investors such as Church Commissioners, Legal & General Investment Management (LGIM) and Schroders to eliminate commodity-driven deforestation from portfolios.
Until now the focus had been on non-financial corporates, on which the FSDA has already drafted guidelines.
The investor-led expectations on banks were developed by FSDA participants, members of IIGCC’s banks working group and led by Kiran Sehra at Aviva Investors, and Lauren Compere of Boston Common, along with Lucia Graham-Wood and Norah Berk at IIGCC.
Commenting on the initiative for IPE, IIGCC chief executive officer Stephanie Pfeifer said a considerable portion of investors’ deforestation exposure can be via their holdings in investment banks.
“We hope that all financial institutions that choose to use these expectations do so as part of a comprehensive approach to tackling deforestation,” she wrote. “For those investors and pension funds that haven’t yet started mapping and/or taking steps to manage their deforestation risk exposure, they present a good opportunity to begin.”
She added: “Our ambition is that many more investors will be integrating measures to tackle deforestation into their investment strategies and processes before COP30 in Belem, Brazil.”
Antimicrobial resistance action wanted
Separately, investors have called on global leaders to ramp up efforts to curb the spread of AMR.
Coming ahead of a UN General Assembly (UNGA) high-level meeting on the topic later this month, the statement was released today with 80 investor signatories, including AP7, HSBC Bank Pension Trust, LGIM, Stichting Pensioenfonds Medewerkers Apotheken, and Varma.
It makes seven requests of global policymakers, such as to support the setting up of a scientific panel similar to the one on climate change, the IPCC, and to support an international framework for AMR.
The statement is the latest call to action from the Investor Action on AMR, which was launched in 2020 and is a coalition between the Access to Medicine Foundation, the FAIRR Initiative and the UK government department for health and social care.
“This collaboration, in the run up to UNGA and beyond, will be pivotal in brokering dialogue around reducing AMR, safeguarding public health, and ensuring the efficacy of life-saving medicine for future generations worldwide,” said Jayasree K. Iyer, CEO of Access to Medicine Foundation.
Maria Larsson Ortino, senior global ESG manager, health lead, at LGIM, added: “AMR poses a serious threat to investment portfolios, economic stability, and global health. It’s encouraging to see a unified response from the investment community, reflecting a shared commitment to address this urgent challenge.”
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