Swiss Pensionskassen and foundations invest only 1% or CHF7.2bn (€6.9bn) of their assets purely according to environment, social, corporate governance (ESG) and ethical criteria, figures of the latest climate rating by Klima Allianz show.
Investments under this category exclude fossil fuels and the operation of nuclear power plants, climate-damaging airlines, and manufacturers of climate-damaging vehicles from the investment universe, contributing to reach a net-zero goal.
Manufacturers of nuclear and conventional weapons and war materials, tobacco, companies whose activities are climate damaging and incur a negative impact on biodiversity are also excluded from investments of a very small minority of Swiss pension funds, according to Klima Allianz’s rating.
Klima Allianz – a network of more than 120 civil society organisations, including environment and development groups, churches, trade unions and consumer associations – has decided to apply stringent criteria to its climate rating for Pensionskassen for the period 2022-2023, assessing current and future greenhouse gas emissions in combination with ESG criteria and the UN Sustainable Development Goals. Previously it only assessed greenhouse gas emissions.
As a result, it added the new category of “visionary” for Pensionskassen investing only according to ecological, sustainable, social and ethical guidelines, with a positive impact on society and the climate, and a vision of a fossil-free, humane and inclusive economy.
The vast majority of Pensionskassen in Switzerland, Klima Allianz said, continues to finance the fossil fuel industry, hindering the path to reach a net zero transition and containing global warming.
According Klima Allianz, 58% of Swiss Pensionskassen with assets of CHF647.4bn invests pension savings in activities that are harmful to the climate, up from 55% in November last year.
The share of pension funds with harmful investments for the climate increased as the organisation decided to apply stringent criteria, it said.
The pension schemes under this category invest in conventional, climate-damaging funds, and are not transparent with regard to their investment policies, Klima Allianz said.
Its research also showed that 16% of the pension funds have taken instead the first steps towards decarbonising portfolios by exiting investments in coal mines and coal-fired power plants, and increasing the “ESG quality” of securities in their portfolios, it said.
More than half of investments in this category is invested by pension funds that recently decided to undertake a path towards net-zero.
Swiss pension funds allocate 25% of their assets, or CHF329bn, supporting the goal of the Glasgow climate conference COP 26 held last autumn to limit global warming to 1.5°C, but in many cases with a lack of commitment to halving the CO2 footprint by 2030, according to Klima Allianz.
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