Report notes companies lag on climate

Report notes companies lag on climate

	Published : Wed, 31 Jan 2007 23:53 By : Agencies Print this Story

WASHINGTON (AFX) - Many big U.S. companies are not doing enough to warn shareholders about the financial risks associated with global warming, a new report asserts.

The report, released jointly on Wednesday by Ceres, an environmental investment group, and the Calvert Group, a mutual fund company, said corporate disclosure of risks related to climate change among S&P 500 companies has been 'severely lacking.'

The authors highlighted the fact that less than half of the companies listed on the S&P 500 responded to a survey last year by the Carbon Disclosure Project, an international effort to collect information from more than 2,100 companies. The project is backed by large investors such as Goldman Sachs Group Inc., Morgan Stanley, Switzerland's UBS AG and the California Public Employees Retirement System.

Coinciding with the report's release, the world's leading scientists gathered in Paris to assess global warming. The report from the Intergovernmental Panel on Climate Change, if it is issued on time Friday, will warn the world that global warming caused by the burning of fossil fuels is here and worsening. And for the first time, the panel will say stronger hurricanes and tropical cyclones since 1970 are 'more likely than not' linked to global warming, according to a preliminary draft.

Ceres president Mindy Lubber said companies that traditionally do not see themselves as big emitters of carbon dioxide and other greenhouse gases, including banks, insurance companies and retailers, need to consider the financial risks posed by climate change.

'Their investors have the right to understand what their risks are and how they are addressing them,' she said.

The report found that 80 percent of the 228 American companies that responded to the carbon survey discussed the need to reduce greenhouse gas emissions, but only about a quarter gave specific emissions targets and a timeline for achieving reductions.

Peyton Fleming, a spokesman for Ceres, said his organization is not arguing that these companies are being overvalued by investors. 'What we are saying is that some companies may be facing potential risks that investors may not know about,' he said.

The report's authors said the most detailed responses were from the automobile, electricity and oil industries, where executives are more accustomed to thinking about climate change. Industries such as retail, insurance, banking and health care were 'largely unresponsive to the financial risks they face,' the report said.

Among insurance companies, American International Group Inc. was the only one to receive praise for its disclosure. Others, such as Chubb Corp., did not respond to the questionnaire. 'We are working on addressing the issue,' said Chubb spokesman Mark Schussel, declining to elaborate further.

In the banking industry, Bank of America Corp. was praised for its efforts. That company plans to reduce greenhouse gas emissions by 9 percent from 2004 levels. But other banks, including Minneapolis-based US Bancorp, were criticized for either not responding to the survey or not disclosing much information.

In its response to the international survey posted on the carbon project's Web site, US Bancorp said it is beginning to evaluate the impact of climate change on its business and does not have a program to measure emissions associated with its offices and branches.

Steve Dale, a company spokesman said the bank recently established the job of environmental policy manager to tackle such issues.