Stockholm (NordSIP) – The Principles for Responsible Investment (PRI) launched the engagement process for its biodiversity focused initiative Spring today, 26 June 2024. Spring has been endorsed by 204 investors representing approximately $15 trillion worth of assets under management. 66 of these will play active roles in the initiative either as collaborating or lead investors focusing on specific companies.
PRI’s Spring initiative aims to use the power of investor stewardship to help address the problem of deforestation and land degradation driving of biodiversity loss. It draws on the goals and targets of the Paris climate agreement and the Kunming-Montréal biodiversity framework and emphasises the material risk to institutional investors presented by the combines crises of climate change, biodiversity loss, and pollution. The engagement efforts with target companies will focus on three main areas:
Business operations, strategy and risk management
Companies will be expected to commit to timebound biodiversity-related targets in line with global agreements along with the appropriate governance structures. They will also be required to report on nature-related risks via accepted standards such as those of the Taskforce on Nature-related Financial Disclosure (TNFD).
Supply chain management
The target companies will need to implement and report on responsible sourcing policies that seek to eliminate deforestation and the conversion of natural ecosystems in direct or indirect supply lines while ensuring respect for human rights.
Political engagement
In an apparent attempt to avoid greenwashing by target companies, the PRI has set out strict requirements regarding their lobbying activities under the Spring initiative. Companies will be expected to disclose their affiliation to trade associations, think tanks, or other entities that may be engaging with policymakers on their behalf. Where there is misalignment with stated biodiversity objectives the companies will be required to take corrective action.
Nordic support
The core group of active Spring lead or collaborative investors includes Nordic Region institutions Aktia Bank, AP2, Church of Sweden, KLP, Länsförsäkringar, LocalTapiola Asset Management, Öhman Fonder, PensionDanmark, and Storebrand. Emine Isciel, Head of Climate and Environment at Storebrand Asset Management said: “Halting and reversing forest loss and land degradation is fundamental for a healthy climate, a sustainable future and long-term investment results. We recognise the need for sound public policy to achieve this goal. Spring’s focus on responsible political engagement fits well with Storebrand’s approach to nature and our involvement in collaborative initiatives. We look forward to working with peers from around the world on this important topic.”
The list of 60 focus companies published today by the PRI may be expanded over time. It is dominated by the agriculture, food, and consumer goods sector and extractive industries. Engagement with Swedish firms AAK AB and AB Volvo is being led by Öhman Fonder and AP2 respectively. Storebrand and the Church of Sweden will lead engagement with Norway’s Norsk Hydro. Dutch pension fund Pensioenfonds Rail & Openbaar Vervoer and French asset manager Ecofi will lead efforts towards Finland’s Neste Oyj.
With collaborative initiatives such as Nature Action 100 already underway, the PRI has stated its intention to align the objectives of Spring accordingly, with a view to avoiding any duplication of efforts. PRI members that are interested in endorsing the Spring initiative or playing an active role as lead or collaborative investors may do so via the dedicated PRI web page.
