A $213 Billion Investor Targets Whole Nation Over Climate Change.

Robeco Institutional Asset Management BV will soon start pressuring Australia to phase out its reliance on coal and other natural resources, as money managers slowly begin targeting governments over climate change.

Australia has a “particularly high-risk profile” when it comes to climate performance, said Peter van der Werf, the Dutch firm’s senior manager of engagement and active ownership. As global investors implement plans to decarbonize portfolios by mid-century, Australia’s lawmakers must follow suit, he said in an interview.

Cutting back on natural resources “are very hard decisions because these are obviously very important sources of revenue for the Australian economy,” Rotterdam-based Van der Werf said. “That’s where in those conversations, institutional investors can also provide a perspective how they would foresee such a transition to take place.”

Unlike established asset manager groups like the Climate Action 100+ that pressure companies such as BHP Group Ltd. to bring their practices in line with the Paris Agreement, bond investors pushing governments to mitigate environmental, social and governance risks is a new concept.

“Aside from green and social bond investing, relatively few efforts have been directed towards helping sovereign debt investors actively contribute to advancing particular sustainable development objectives -- this is surprising,” since government bonds account for almost 70% of the $128 trillion global bond market, Robeco analysts wrote in a report this month.

16 June 2021

Bloomberg Green