A group of investors representing over $795bn (£592bn) in assets under management has issued a public statement urging high-emitting companies to take stronger action on air pollution, calling it a “silent yet deadly” financial risk.
Coordinated by responsible investment NGO Share Action, the investor group warns that corporate air pollution is severely underestimated in financial risk assessments and corporate sustainability strategies.
Signatories of the statement include Dutch financial firm Achmea, leading pension fund NEST and UK charity Ethos Foundation.
Justine Holmes, clean air lead at Share Action, said: “Air pollution is linked to millions of premature deaths annually, yet frustratingly few companies are acknowledging and acting to address this critical issue. This poses dangers for public health and it’s an under appreciated financial liability that investors are sounding the alarm on.”
Dirty air has overtaken tobacco use as the world’s second leading risk factor for premature death.
At the same time, governments are implementing stricter air quality regulations and corporate disclosure standards such as the Sustainability Accounting Standards Board acknowledge air pollution is a significant business concern.
In spite of these developments, too few companies acknowledge air pollution as a material business issue, the investors warn.
A lack of emissions disclosure and limited management of associated health risks not only exposes communities and workers to harm – it also creates reputational, regulatory, and legal risks for businesses and their shareholders.
More broadly, the World Bank estimates that health damage caused by air pollution costs the global economy 5% of GDP annually, with this figure expected to rise.
Several leading companies have already begun tackling air pollution through initiatives such as the World Economic Forum’s Alliance for Clean Air. Investors hope others will follow suit to drive long-term health, productivity, and economic resilience.
The signatories are inviting more investors to join the initiative and sign on to the declaration and plan to engage directly with targeted companies, policymakers and standard-setting bodies throughout the year.
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