WATCH LIVE | Will pension funds meet the green challenge?

Pressure is growing for businesses to revise their priorities and shift focus to environmental, social and governance (ESG) sustainability initiatives to attract business investment.

For pension fund investment teams, the question is whether to secure the financial futures of their shareholders through businesses that may harm or heal the planet.

COP26, the global climate summit, takes place in November and national leaders will again consider the actions required to mitigate climate change by shaping the impact of industries and countries that maintain a disproportionately heavy reliance on non-renewable, fossil-fuel energy resources. The success of the 2015 Paris Climate Accord pledges is going to be strongly influenced by the willingness of the public to have a voice about where their investments are being placed.

Recently, Nedbank and FirstRand Bank both started to withdraw financing for coal-fired power plants in SA as the country is already the 12th-largest contributor to greenhouse gas emissions in the world. Similarly, the Remgro investment group recently announced a priority shift that will focus more closely on sustainable business practices.

In fact, for the country to reach President Cyril Ramaphosa’s climate goals of being carbon neutral/net zero by 2050, all industries will need to play their part. As it stands, the ambition is to cut SA’s greenhouse gas emissions by a third by 2030.

Against this backdrop, ESG is steadily gaining traction as a measure of the collective will of organisations towards their environmental and social responsibility — where the sustainability discussions in boardrooms are driving investment-based decision-making, and where impact investments will become more important than ever.  

With a growing list of firms committed to withdrawing support for businesses that have no plans to transition away from reliance on non-renewable energy resources, it is clear that shareholder returns are no longer the only metric under consideration when shaping investment portfolios.

But what are the knock-on effects for pension fund investments? How much weight should ESG principles carry, and what role does shareholder activism play in each case?

Join the Business Day Dialogues LIVE in association with the Konrad-Adenauer-Stiftung as a panel of experts debates the principles shaping investment attitudes that favour those businesses with a commitment to environmental sustainability and social wellbeing, while balancing the financial prosperity of pension funds in SA.

The discussion will be moderated by Business Day TV senior news anchor Alishia Seckam. Hear more from:

• Neels Kilian: law faculty member, North-West University;
• Muvhango Antoinette Lukhaimane: pension funds adjudicator; and 
• Prof Ruth Taplin: editor and founder, Interdisciplinary Journal of Economics and Business Law.

Join the discussion

• Date: Tuesday November 9
• Time: 11am-12pm

Click here to register for this FREE event >>