Trucost: For the first time ever, investors and fund managers are now able to compare the carbon footprints of leading U.S. mutual funds, thanks to a report released today by Trucost, the world's foremost environmental data & research company. The report shows that the carbon intensity of mutual funds varies widely, with the highest-carbon fund found to be 38 times more carbon intensive than the fund with the smallest carbon footprint.The groundbreaking "Carbon Counts USA" report examines the carbon performance of major U.S. mutual funds with a combined value of $1,551,067 million. The research covers 75 of the nation's largest equity funds and 16 major sustainability/socially responsible investment (SRI) funds, using fund holdings and style analysis data provided by Lipper, a Thomson Reuters company.
Analysis of the greenhouse gas emissions associated with eight investment styles shows that overall, sustainability/SRI funds have a smaller carbon footprint than core, growth, value, index, country/regional, equity income and sector funds. However, some of the largest SRI funds are among the most carbon-intensive analyzed, reflecting the diverse environmental, social and governance criteria used by managers.
…Funds with large carbon footprints have holdings which could face greater financial risk from carbon being priced under cap-and-trade schemes. Companies with heavy carbon footprints for their sectors could be hardest hit by carbon costs under carbon trading, promised in the latest U.S. federal budget. The carbon intensity of companies will influence which are most exposed, with knock-on effects on investment returns. Carbon-efficient investment funds are set to be well positioned under carbon constraints….
The Kintigh Generating Station in Somerset, New York. Shot by Matthew D. Wilson (LtPowers), Wikimedia Commons, under the Creative Commons Attribution ShareAlike 2.5 License
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