“Green” Pressure

Investors are now starting to “go green,” which will likely impact corporate action.

With that in mind, it is important to note that Makovsky + Company’s “Green Gap Survey” of the Fortune 1000, with Harris Interactive, demonstrated that while nearly 80% of corporate leaders were personally concerned about climate change and the threat it posed to future generations, only 57% of companies were taking action to address CO2 emissions standards.

However, once major institutional funds start diverting their “greens” to corporations that indeed are acting to change the environment, might that lagging percentage go up?

A recent New York Times story by Elisabeth Rosenthal on November 28 noted that “investing with the idea of improving the environmental actions of corporations, not just maximizing profit, is catching on among some big pension funds and foundations particularly in Europe and even in the U.S.” These huge funds are redirecting investment to either those companies who don’t damage the environment or have programs that limit their emissions that contribute to global warming. Some funds are also divesting themselves of stakes in companies that are environmentally lax.

Some of the funds involved are the Norwegian Government Pension Fund–Global, ABP (the huge Dutch government pension fund), the pension fund of the British Environmental Agency and the California State Teachers’ Retirement Fund, among others.

Money talks – and the “green gap” will close … albeit gradually. Other expected pressures ? Federal regulations and consumer demands.


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