Stockholm (NordSIP) – Storebrand announced it had adopted a new Policy on Nature, meant to reinforce its commitment to halting and reversing the loss of biodiversity, which came into effect on December 1st. The policy is a supporting document to the Storebrand Group Sustainable Investment Policy, detailing how Storebrand can contribute to reversing nature loss.
“More than half of the world’s total GDP is moderately or highly dependent on nature and its services. Yet, the value of nature and ‘ecosystem services’ has been largely unacknowledged by companies and their investors. This is despite the fact that failure to act could result in collapsing food systems, loss of livelihoods and pose a systemic risk to the global economy,” says Jan Erik Saugestad (Pictured), CEO Storebrand Asset Management.
With the adoption of the policy, the precautionary approach will be applied more active when making investment decisions.
The document provides a definition of biodiversity and nature and reviews the drivers of nature loss, including land use change and nature deterioration, overexploitation, climate change, invasive species and pollution. The policy is based on the financial risk inherent to the assessment that five of the nine “planetary boundaries”, that ensure the stable conditions necessary for civilisations to form and prosper, are already exceeded.
The new document proposes four strategies and investment methods to support nature and biodiversity, including impact assessment and target setting, engaging with companies and other relevant stakeholders, risk management that increases positive and reduces negative impacts on nature, and reporting aligned with the Taskforce on Nature related Financial Disclosure (TNFD) recommendations.
Nature loss impacts the economy
As a result of the adoption of this new policy, Storebrand will no longer invest in companies with mining operations that conduct marine or riverine tailings disposal, companies involved in deep sea mining, and companies that derive 5 % of their revenues from drilling in Arctic areas that are considered especially vulnerable and valuable. This means that the asset manager has immediately excluded four new companies in the mining industry as a result of the policy.
Storebrand’s existing deforestation commitment, which had a special focus on palm oil, soy, cattle products and timber, will be expanded to include deforestation or conversion for production of cocoa, rubber, coffee, and mining. Companies contributing to this are being mapped and assessed for targeted engagement or exclusions, as a step forward for us to achieve our goal of eliminating commodity-driven deforestation in our portfolios by 2025.
In addition, companies that lobby against agreements which promote sustainable use of nature, such as the new goals that will be adopted by the Convention on Biological Diversity later this year in Montreal, will risk exclusion. Moreover, partnerships and coalitions like Nature Action 100 and the future TNFD will be key levers for greater integration of biodiversity challenges.
“The investment industry cannot solve the biodiversity crisis by itself. To succeed we need collaboration with governments, corporates and finance. We need better regulations on all levels and better reporting. There are few regulatory incentives for companies to curb practices that are harmful to nature. I would like to see governments step up when they meet in Montreal in December”, concludes Jan Erik Saugestad.