"Socially responsible" funds may not be so virtuous - Finance

“Socially responsible” funds may not be so virtuous – Finance

In its report on socially responsible investment (SRI) in Belgium, Financité analyzes the composition of funds that present themselves as socially responsible. It emerges this year that 92% of them still have at least one asset placed on one of its blacklists, indicates the ASBL for the promotion of responsible and united finance on Friday in a press release.

As of December 31, 2,314 self-proclaimed SRI funds were identified, for record assets of 211.72 billion euros (+106.95 billion euros compared to the end of 2020). Of these, the composition of 916 of them could be analyzed.

These are the assets of the fundamental rights blacklist (i.e. which do not respect the international conventions ratified by Belgium) which are most regularly present in the portfolios of funds presented as socially responsible: of the 916 analyzed, 815 of them (89%) have invested in at least one asset from this list. Next come those linked to climate control activities (625 funds, i.e. 68%), nuclear power (538.59%) and weapons of war (319.35%).

No less than 264 funds, or 29% of those studied, have assets present in the four blacklists of Financité. “These funds support activities that cannot be described as socially responsible: these are activities that have a negative impact on the climate, are dangerous for human life (weapons of war) or are very controversial such as nuclear industry,” she said. According to Financité’s analysis, 14.5 billion out of the 211.72 billion outstanding are placed on the blacklists.

Only 67 funds out of the 916 analyzed pass the filter of the four lists.

Funds recognized as SRI and labeled “Towards sustainability” do not do much better than the average, with 84% of funds holding at least one asset on the blacklist of fundamental rights, 62% for climate-killing assets, 53% related to nuclear and 22% to weapons of war.

As of December 31, 2,314 self-proclaimed SRI funds were identified, for record assets of 211.72 billion euros (+106.95 billion euros compared to the end of 2020). Of these, the composition of 916 of them could be analyzed. It is the assets on the black list of fundamental rights (i.e. which do not respect the international conventions ratified by Belgium) which are most regularly present in the portfolios of funds presented as socially responsible: out of the 916 analysed, 815 of them (89%) have invested in at least one asset from this list. Next come those linked to climate control activities (625 funds, i.e. 68%), nuclear power (538.59%) and weapons of war (319.35%). No less than 264 funds, or 29% of those studied, have assets present in the four Financité blacklists. “These funds support activities that cannot be described as socially responsible: these are activities that have a negative impact on the climate, are dangerous for human life (weapons of war) or are very controversial such as nuclear industry,” she said. According to Financité’s analysis, 14.5 billion out of the 211.72 billion outstanding are placed on the blacklists. Only 67 funds out of the 916 analyzed pass the filter of the four lists. Funds recognized as SRI and labeled “Towards sustainability” do not do much better than the average, with 84% of funds holding at least one asset on the blacklist of fundamental rights, 62% for climate-killing assets, 53% related to nuclear and 22% to weapons of war.

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