Paris, June 1st 2017 – The financial sector is showing increasing awareness of climate change, with 60% to 70% of major institutional investors and global asset managers now publishing data on their exposure to climate risk. Yet less than a quarter of them are taking concrete action to decarbonise their investment portfolios. As a key driver in decarbonising the economy, the financial sector must transform itself through a low-carbon strategy that marries climate responsibility with financial efficiency. EcoAct and Forward Finance are joining forces to address this need, providing support for investors with their low-carbon strategies and responding to the new requirements of France’s energy transition law.
The Paris Agreement highlights the key role the financial sector has to play in keeping the increase in global temperatures below 2°C, by making “finance flows consistent with a pathway towards low greenhouse gas emissions and climate-resilient development”. The challenge exists not so much in identifying new sources of funding as in re-routing current flows, by backing the companies leading the way in ecological and energy transition, and supporting the worldwide economy’s transition towards the 2°C target.
The financial sector could even be a driving force in decarbonising the economy: indeed, investors cannot be unaware of the risk to financial assets from climate change, currently estimated at 2.5 trillion dollars for a 2.5°C rise in temperatures. On an international level, 60% of the 500 leading institutional investors (representing 27,000 billion dollars) and 70% of the 50 top global asset managers (managing assets worth 43,000 billion dollars on behalf of their clients) now provide information on the potential impact of climate change on their investments. Article 173-VI of the French energy transition law addresses this risk by requiring institutional investors to assess and disclose the potential impact of climate change on their investment portfolios (climate risk) and the impact their investments have on climate change (the portfolios’ carbon footprints). This creates a robust base on which to build a low-carbon strategy that reconciles climate responsibility and financial efficiency.
In response to these new requirements, EcoAct and Forward Finance are pooling their expertise to:
- estimate the carbon footprint of investment portfolios;
- assess climate and transition risks related to investment portfolios;
- design and implement strategies to decarbonise investment portfolios.
Forward Finance brings in-depth knowledge of the financial sector to complement EcoAct’s expertise in assessing carbon footprints and climate and transition risk. The partnership aims to provide investors with the essential tools to meet the requirements of article 173-VI of the energy transition law, and above all to support them in optimising their portfolios’ environmental performance, within the framework of a comprehensive low-carbon strategy.
Gerald Maradan, CEO of EcoAct, stated:“By pooling their expertise, EcoAct and Forward Finance can now offer concrete solutions that enable investors to meet their regulatory obligations and engage in the low-carbon transition.“
Kim Nguyen, Managing Director of Forward Finance, added: “Together, our two teams offer a multidisciplinary approach to helping investors assess performance in a new way: by including climate data in their analysis of their asset portfolio, we can fine-tune their strategy and provide concrete solutions to current and future issues.”
EcoAct Group provides companies and territories with unique expertise in planning for and implementing positive change in response to climate change.
Driven by shared values, our experts have been developing mitigation and adaptation strategies on a global level for over 10 years. With their help, leaders are making climate a key lever for performance and innovation.
EcoAct achieves this by bringing together 3 areas of expertise:
- strategic guidance: auditing, decrypting, prospecting, network coordination, defining and implementing road maps, etc.
- data modelling and analysis (smart data): defining indicators, aggregation, comparative scenarios and projections, etc.
- project design and management: change management, mitigation, adaptation and offsetting measures, testing and developing projects in the field, etc.
About Forward Finance
For over 15 years, Forward Finance has worked with investors looking for a leading partner to support them with all their asset management issues. Our teams are committed to the success of our clients’ goals and projects, whether through consultancy or ad hoc assistance and service interventions. Our staff embodies the values on which our company is built: transparency, responsiveness, and guidance.
Forward Finance provides tailor-made expertise that helps you save time, see the bigger picture, take control of your decisions, and consolidate your choices.