CDP launches first climate impact fund rating platform

CDP’s new initiative – Climetrics – was launched on 6 July, rating private equity and exchange traded funds on their environmental impact.

The initiative is funded by the EU’s climate innovation initiative Climate-KIC, and is the first of its kind.

The platform lists 2,500 European funds – equal to €2.5 trillion – and aims at helping investors in their investment decision-making taking the climate change impact of the funds into account.

Climetrics rates 80 per cent of all European assets in equity funds currently for sale according to a rating system on a scale of one-to-five 'green leaves'.

Academics, NGOs, asset managers and asset owners have worked in collaboration to help develop the rating system, which takes into account factors including the environmental impact of the companies invested in – the portfolio score, the integration of governance and investment practices – asset manager score, and the specific ESG mandate – fund policy mandate.

CDP is hoping this new rating system will encourage organisations to develop more climate-responsible fund products.

Only 221 of all the listed funds have received the highest rating of five green leaves so far.

CDP’s Executive Chair Paul Dickinson said:"Climetrics is a missing link between individual investment choices and the global problem of climate change, and will move the needle in incentivising both investors and companies to contribute to the low-carbon transition."

Join CDP at the Sustainable Investment Forum next September in New York. Secure your place here