We believe that accelerating environmental damage from climate, deforestation, ocean pollution, and loss of biodiversity all pose significant risk to economies and the corporate bottom line.

Companies depend on the services provided by nature e.g. flood, drought and storm protection, climate regulation, pollination, pest control, water and soil quality. Certain sectors e.g. agriculture and food retail, can face volatile costs and availability as a result of a decline in these services. 

In 2019 we also signed two investor statements publicising our continuing support for tackling the issue of mass deforestation:

  • In April 2019 we signed The UN PRI Investor Statement on Palm Oil, where 56 investors signalled support for the Round Table on Sustainable Palm Oil and called for the palm oil industry to adopt and implement publicly available No Deforestation, No Peat and No Exploitation policies.
  • In September 2019 we furthered our commitment and signed the UN PRI Investor Statement on Corporate Action on Deforestation -  230 institutional investors representing USD $16.2 trillion in assets under management are calling on companies to take urgent action in light of the devastating fires in the Amazon, which have been fuelled in part because of the deforestation happening at an alarming rate in Brazil and Bolivia.

We are a member on the ZSL SPOTT palm oil Technical Advisory Committee. Following our guide for investors ‘Sustainable Palm Oil and Responsible Investment’, we co-published and hosted the launch of the Palm Oil: a Business Case for Sustainability in December 2019. This report makes a clear argument for those in the palm oil industry to urgently change their practices, and to make a required push for sustainability. To reduce the palm oil sector’s contribution to the climate crisis, its impacts on the world’s forests must be addressed with urgency. The report is aimed at producers, buyers and investors seeking to understand the financial and business-based arguments for addressing the environmental, social and governance (ESG) impacts of unsustainable palm oil production.

The research found that on average, companies scoring higher on sustainability outperformed lower-scoring companies on a total return basis by around 20%, when comparing the top- and bottom-scoring halves of the SPOTT survey dataset from 2014-19. The highest-scoring companies also appeared to show lower levels of volatility and more consistent returns. Thus, showing a robust financial case, in addition to the ecological and moral case for sustainable palm oil.

If you want to read the full report please follow the link: Palm Oil: a Business Case for Sustainability’

If you are interested in reading our prior publications with SPOTT please follow the link: 'Sustainable Palm Oil and Responsible Investment'

Note: Company names shown are for informational purposes only. This is not an offer to sell, nor a solicitation to buy, securities.

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