Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Investors call for private firms to disclose more environmental data

Published 09/07/2021, 07:11 PM
Updated 09/07/2021, 07:33 PM
© Reuters. FILE PHOTO: The symbolic last piece of stone coal harvested in a German mine to mark the end of coal mining in Germany is pictured after miners handed it over to German President Frank-Walter Steinmeier at Bellevue palace in Berlin, Germany, April 3, 2019

© Reuters. FILE PHOTO: The symbolic last piece of stone coal harvested in a German mine to mark the end of coal mining in Germany is pictured after miners handed it over to German President Frank-Walter Steinmeier at Bellevue palace in Berlin, Germany, April 3, 2019

By Simon Jessop

LONDON (Reuters) - Investors managing $2.3 trillion in assets on Wednesday called for more than 1,000 private companies to provide environmental data through non-profit disclosure platform CDP to address a gap in transparency with their listed peers.

CDP said the group, including Neuberger Berman and Nuveen, had helped create a questionnaire for private firms that would be used to benchmark them - a crucial step as they increasingly snap up high-carbon assets from listed companies.

Those deals, such as oil major BP (NYSE:BP)'s $5.6 billion sale of its Alaska Oil and Gas business to Hilcorp Energy, risked hindering investors' handling of climate change risks given private firms' reduced reporting requirements, the group said.

Other investors to back the initiative, dubbed the Private Markets Pilot, include M&G, Beach Point Capital, Coller Capital and Intermediate Capital Group.

The project comes as record amounts of capital are put to work in private equity and debt markets by investors. Private equity net asset value has grown three times as fast as public markets since the turn of the century, the group said.

"Encouraging more private companies to actively measure and disclose their carbon impacts - and also their water and possible deforestation impacts - is no longer a nice to have - it is essential to the low carbon transition," said Adam Black, Partner and Head of ESG & Sustainability at Coller Capital.

"Moreover, it will better enable investors to make much more informed investment management decisions when it comes to the private markets."

© Reuters. FILE PHOTO: The symbolic last piece of stone coal harvested in a German mine to mark the end of coal mining in Germany is pictured after miners handed it over to German President Frank-Walter Steinmeier at Bellevue palace in Berlin, Germany, April 3, 2019.      REUTERS/Fabrizio Bensch/File Photo

Claire Elsdon, Joint Global Director of Capital Markets at CDP, said the data from private companies was crucial to ensure investors could meet their own commitments to reach net-zero emissions across their portfolios by 2050.

"This pilot is essential to avoiding “emissions leakage” between asset classes such as public companies selling high-carbon intense assets to private companies in a bid to avoid scrutiny and transparency," she added.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.