Berkeley, CA – As You Sow today released new Fossil Free Finance and Insurance ratings that score mutual funds and ETFs based on their investments in banks and insurers providing loans and underwriting that support fossil fuel projects.
The Fossil Fuel Finance and Fossil Fuel Insurance ratings are the latest additions to the Fossil Free Funds investment tool. The new fund ratings score investment portfolios based on their exposure to banks that are financing fossil fuels and insurance companies that are underwriting and investing in coal, oil, and gas. The new fund ratings are designed to help investors identify investments that avoid climate risk from financial institutions.
“Since the Paris Agreement, the six largest U.S. banks — JPMorgan Chase, Citi, Wells Fargo, Bank of America, Morgan Stanley, and Goldman Sachs — have provided $1.4 trillion in financing to the fossil fuel industry, contributing to the climate crisis and resulting in substantial portfolio risk for investors,” said Andrew Montes, manager of As You Sow’s Invest Your Values program. “Investors in mutual funds, ETFs, and 401(k)s deserve to understand the climate risk embedded in their portfolios from these financial institutions.”
Commercial and investment banks’ carbon-intensive funding is fundamentally incompatible with reaching the 1.5-degree aligned global goal necessary to prevent catastrophic climate harm. Primary insurers and reinsurers are also continuing to underwrite and invest in coal, oil, and gas, while experiencing dramatic losses associated with catastrophic weather-related events.
“By continuing to provide support to high-carbon companies and projects, financial institutions are exacerbating the climate crisis and delaying the transition to a clean energy economy,” said Danielle Fugere, president of As You Sow. “Climate change creates financial risk. Investors should be aware of which companies in their portfolios are contributing to those risks.”