Mercer Offers ‘Carbon Footprint’ Analysis of Client Portfolios

Mercer, MMC’s consulting services division, has announced that it “can now provide clients with a ‘carbon footprint’ analysis of their portfolio/s, and compare it to a chosen benchmark, such as the FTSE All-Share, S&P 500 or Russell 1000.”

Mercer noted that it had developed the new service in response to requests from institutional investors, who “have expressed an interest in assessing and better managing the risks and opportunities associated with the impact of their investments on the environment and climate change.”

“This new tool will allow us to help clients understand the carbon exposure of their equity investments. Acting as an indicator, the carbon footprint and additional analysis will enable our team to work with clients to ‘green’ their portfolios,” explained Danyelle Guyatt, principal at Mercer. “In addition, providing this type of information to clients will better equip them to raise climate change issues with their investment managers in a way that is systematic and comparable across managers.”

Mercer added that it would “develop ‘carbon footprint’ analyses via use of the Style Research Portfolio Analyzer (SRPA) tool that can now integrate relevant information from Trucost Plc, a leading environmental data provider. A portfolio’s ‘carbon footprint’ is a measure of the impact that a company has on the environment in terms of the amount of greenhouse gas emissions produced. Through this unique relationship with Trucost, Mercer is the first global investment consultancy to provide carbon footprint analysis to clients.”

Trucost Chief Executive, Simon Thomas, noted that the partnership with Mercer “means that Trucost’s leading database of corporate greenhouse gas emissions is available to a wider audience. It will help trustees better understand overall exposure of their funds to the rising costs of carbon inefficiencies.”

“Trustees can encourage fund managers to use carbon footprints to help identify and manage carbon risks and opportunities in existing portfolios, as well as to create carbon-efficient investment products,” added Neil McIndoe, Trucost Head of Environmental Finance.

Source: Mercer – www.mercer.com