Stockholm (NordSIP) – As the fourth session of the Intergovernmental Negotiating Committee to develop an international legally binding instrument on plastic pollution (INC-4) begins today 23 April 2024 in Ottawa, Canada, 160 financial institutions representing assets worth $15.5 trillion have co-signed a statement expressing their strong support for an ambitious and robust outcome.
The statement from the financial sector to the member states negotiating the internationally legally binding instrument (ILBI) to end plastic pollution was drafted by the United Nations Environment Programme Finance Initiative (UNEP FI), Principles for Responsible Investment (PRI), Finance for Biodiversity Foundation, Business Coalition for a Global Plastics Treaty, Dutch Association of Investors for Sustainable Development (VBDO) and CDP. The signatories cover all regions of the globe including 15 financial institutions from India, Japan, Indonesia, and the Republic of Korea. The latter country will host the fifth and final session (INC-5), which will in held in Busan from 25 November to 1 December 2024.
The plastic pollution crisis has been rapidly rising up the supranational sustainability agenda, with clearer links being established with both climate change and biodiversity loss. Based on current production and consumption data, plastics are on course to account for 15% of global greenhouse gas (GHG) emissions by 2050 if no action is taken. The 160 co-signatories are calling for the ILBI to be supported by clear, science-based rules and regulations addressing the full life cycle of plastics. They believe that voluntary initiatives are insufficient and would therefore like the plastics treaty to emulate the Paris climate agreement and Kunming-Montréal Global Biodiversity framework in aligning public and private financial flows with a common legally binding objective. This should be supported by harmonised targets and binding obligations across the plastics value chain, with full disclosure of relevant risks and opportunities.
Producer responsibility
Raw plastic manufacturers and large-scale producers of single-use plastics have thus far been largely able to avoid dealing with and paying for the associated negative externalities. Industry associations such as the Alliance to End Plastic Waste (AEPW) have tended to support downstream waste management and recycling solutions supported by municipalities and voluntary schemes. The joint statement therefore calls for a more enabling policy environment that can support a shift to a more equitable economic model with harmonised extended producer responsibility schemes (EPR). As well as better management of plastic waste, the ILBI should encourage the production and use of alternative materials to stem the ever-increasing flow of raw virgin plastic.
Strong support from Nordic institutional investors is evident in the signatory list, which includes all of Sweden’s main pension buffer funds as well as €108 billion AP7. They are joined by East Capital Group, EVLI, Handelsbanken Fonder, LocalTapiola Asset Management, Storebrand Asset Management, Swedbank Robur Fonder, and the Folksam Group.
Commenting on the release of the joint statement David Atkin, CEO at the PRI said: “Climate change, biodiversity loss, plastic pollution and other issues cannot be tackled in isolation, but require systemic responses. With today’s announcement, investors are signalling their desire for governments to establish a clear, robust policy mandate to tackle the issue of plastic pollution, in keeping with efforts on climate and biodiversity. This mandate should call for an end to plastic pollution and be based on a scientific approach which orients all economic actors towards its objectives.”
NordSIP will report on the outcome of INC-4, which is scheduled to end on Monday 29 April.
