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Activists push SA pension funds to tally climate costs

Just Share and ClientEarth write to more than 50 SA funds about their duty to savers.

Pension funds in South Africa have a legal obligation to account for the financial effects of climate change on their investments, according to two groups lobbying money managers to pay closer attention to the issue.

Shareholder activists Just Share and environmental law organisation ClientEarth have written to more than 50 funds in Africa’s most-industrialised nation about their duty to savers. The local industry oversees about R4.2 trillion in retirement investments, according to the two groups.

Legal opinion commissioned by the campaigners shows that failing to meet the requirement on climate change “would likely amount to a breach of duty by the board of a pension fund,” they said in a joint statement Monday.

Oil companies and Norway’s sovereign wealth fund are responding to climate change through steps ranging from planting forests to divesting from fossil fuels. South Africa is dependent on coal for almost all of its power generation and unemployment of about 27% complicates the debate around reducing this reliance, should it lead to closing mines and job losses.

The ultimate effects of climate change and the cost of transitioning to a low-carbon economy should form part of money managers’ investment strategies, Tracey Davies, executive director for Just Share, said by phone. “The primary reason is the fiduciary responsibility for the funds to invest in the long term.’’

South Africa’s 2030 energy plan sees coal-generated power dropping to less than 50% of the total, as investment increases in renewables such as wind and solar.

But, South African companies have been highlighting some of the potential costs. Anglo American Platinum, the world’s biggest producer of the metal, said April 9 that a planned carbon tax in the country will add cost pressures for marginal and loss-making operations.

Reaction from funds that responded to the campaigners’ questions ranged from interest in discussing the issue to asking whether they were being accused of doing something wrong, Davies said. The initial purpose of the letters was to raise awareness. “You’ve got to understand how exposed your portfolio is to climate policy.”

© 2019 Bloomberg L.P

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What a lot of twaddle. I for one would object strongly to any interference in the strategy that affects my annuity (I am a pensioner). I fail to see the benefits of carbon tax, sugar tax and all the other nonsensical revenue theft by governments.
All that happens is that consumers end up paying more from diminisihing income for no practical benefits.
Anyway the money ends up in the ANC hierarchy’s pockets.

Agree. Tell these clowns to voesek and get a life. Leave my pension funds alone.

Perhaps pension funds should give their clients a choice to invest in this ‘climate change’portfolios, then we see how popular they are. The moment people see lower growth it will be the end of it.

Blerrie tree huggers and bunny sqeezers.

And there you have it people.. The selfish effects of capitalism on the people “Future? Screw the future. ME ME ME ME ME ME ME ME ME”

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