How do financial firms deal with carbon disclosure?

Financial institutions – in particular the investment side of the business – have a greater indirect than direct impact on carbon emissions. The policies they adopt with respect to environmental disclosure can easily affect the business decisions of their client companies. The UK Carbon Disclosure Standards Board has published an academic study of how financial companies in the US, Europe, Japan and Australia deal with the information that is being increasingly available from the corporations in which they invest. The researchers were surprised with what they found:
We identify an absence of a general market momentum towards environmental investing while at the same time strong demand for company reports on environmental matters. Although most questionnaire respondents and interviewees had collected company-issued reports on greenhouse gases emissions levels and environmental management programmes, all were dissatisfied with that information, and none had used it to guide portfolio allocation levels.

It will come as little surprise from corporations that deal with the analysts on Wall Street and in the City of London, however, that investment banks and asset managers demands tons of information and then do relatively little with it. The same might be said of academic researchers. But we know there's a lag-time with knowledge. Information accumulates and then emerges as insight, well before reaching a tipping point. A bit like climate change itself.

Source document: The Carbon Disclosure report, "Financial institutions: Taking greenhouse gases into account," by Matthew Haigh and Matthew Shapiro, is a 74-page pdf file.