Greenpeace report highlights climate risks in Chinese asset management investments
According to a new Greenpeace report, major Chinese asset managers have billions of dollars invested in fossil fuels and have no plans to phase them out.
The environmental organization’s analysis examined 16 major Chinese asset managers and found that they have invested a combined 267.2 billion yuan ($36.79 billion) in high-carbon sectors and 74 billion yuan in fossil-fuel-related areas.
Five firms – E Fund, Fullgoal, GF, Southern, and China Universal – accounted for over half of the investment in high-carbon.
China’s largest asset manager, E Fund, invested 40.6 billion yuan in high-carbon sectors and 18.9 billion in fossil fuels.
Yuan Yuan, Greenpeace East Asia’s climate and energy campaigner, said, ” Investment in high-carbon assets shows a significant exposure to climate risks. There are no unified definitions or guiding principles of transition finance at the moment. Asset managers have the responsibility to push stronger transitions in high-carbon industries, and they need to develop detailed engagement strategies for investee companies on climate issues.”
The report emphasizes the urgent need for asset managers to translate knowledge into concrete climate actions.
It finds that due to factors such as regulatory policy development and increased institutional awareness, Chinese asset management institutions have progressed in addressing climate change. However, they still lag behind internationally recognized standards.
Read more: European asset managers prepare for ESG fund purge, post new regulations
The group recommends that policymakers, regulators, asset managers, and asset owners collectively intensify their efforts to address climate change-related risks and accelerate the financial industry’s support for China’s carbon neutrality goals.
Yuan added, “ESG investing guidelines became a major source of progress in sustainable investing in China. However, unclear definitions and lack of disclosures of sustainability-themed investment products present greenwashing risks for ‘carbon neutral’ funds. Regulations on disclosure would provide critical oversight for sustainable and green assets.”
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