Financial investors have evolved from bystanders to leaders in climate action

Big financial investors, such as banks, insurance companies, investment trusts or pension funds, have long ignored the climate crisis as a field of action. But by now they have become one of the biggest drivers of change in the approach of industrial societies towards the environment, Ingo Narat and Christian Schnell write in the Handelsblatt. The investors put pressure on companies in search of credits to reveal the climate risks of possible investments and to formulate a risk management strategy, a change in tone that two thirds of the largest companies listed on Germany’s stock exchange report they have experienced, the article says. While the pressure investors exert has its boundaries in that they still intend to generate profits from any investment, capital owners seem to increasingly realise that inaction in climate questions could damage their revenue prospects even more in the long run, the authors say.

Read the article in German here.

Find background in the CLEW interview with the German stock exchange’s sustainability head.