INSIGHT by Fidelity International
Nature loss is one of the most severe risks humanity faces over the next decade according to the World Economic Forum,* and is considered a significant systematic risk. Tackling nature loss is therefore one of Fidelity International’s (‘Fidelity’) top priorities within its sustainability strategy. In line with its sustainability ambition, Fidelity takes a step further in its commitment to addressing nature loss with the publication of its Nature Roadmap.
This follows the firm’s initiative as a foundation member and signatory of the Finance for Biodiversity pledge, which aims to protect and restore biodiversity**.
The Nature Roadmap outlines the company’s approach to further integrating nature in its sustainable investments and stewardship processes and reinforces nature-related risks management and opportunities. This includes a range of actions, including:
〉Ensuring robust governance and oversight of sustainability related issues, including nature
〉Integrating nature in its proprietary Environmental, Social and Governance (ESG) tools, including its ESG ratings, Sustainable Development Goals (SDG) tool and Climate rating, as well as leveraging external tools and data to enhance the integration of nature-related impacts, dependencies and associated risks and opportunities
〉Integrating nature in its stewardship and voting activities (see more below)
〉Ensuring nature is embedded in its Sustainable Investing Framework, to facilitate responsible capital allocation and deliver solutions to clients
〉Policy engagement and system-wide stewardship
| Focusing on deforestation: addressing the issue through voting
At COP26, Fidelity signed the Financial Sector Commitment Letter on Eliminating Commodity-Driven Deforestation*** with the intention to use best efforts towards the goal of eliminating forest-risk agricultural commodity-driven deforestation activities in investment strategies by 2025 via engagement and stewardship.
The Nature Roadmap firmly articulates the company’s engagement-led approach, including its expectations of exposed investee companies, and its escalation approach where companies do not meet expectations.
From 2024, Fidelity will begin to vote against companies in high-risk sectors that do not meet its minimum standards of deforestation-related practices and disclosure.
“The loss of natural capital is a systematic risk to capital markets, and as such, prioritising and contributing to the health and preservation of our biodiversity and ecosystems is essential.
“The launch of our Nature Roadmap, along with the application of our deforestation voting principles and guidelines, demonstrates our commitment to natural capital conservation, setting out the approach we have chosen and articulating the broad range of tools we have at our disposal to integrate nature in our investment and stewardship processes.
“We seek to make a difference not only through direct corporate dialogue but in collaboration with the industry through system-wide stewardship, helping to shape an enabling policy and regulatory environment which places a fair value on natural capital and the ecosystem services from which we all benefit.”
-Jenn-Hui Tan, Chief Sustainability Officer, Fidelity International
* World Economic Forum, The Global Risks Report 2023, January 2023 WEF_Global_Risks_Report_2023.pdf (weforum.org).
**As a Finance for Biodiversity pledge signatory and foundation member (September 2021), Fidelity has committed to protecting and restoring biodiversity through its financing activities and investments, collaboration and sharing knowledge; engaging with companies; assessing impact; setting targets; and reporting publicly on these activities before 2025.
| brief bio
Jenn-Hui Tan is Chief Sustainability Officer for Fidelity International. Jenn is responsible for the firm’s approach to sustainability across corporate operations and client service areas, including investment management, advisory and personal investment platform services and retirement solutions. He leads the sustainable investing and corporate sustainability teams. He chairs the firm’s Global Sustainability Committee and is a member of its Senior Leadership Team. He is a member of the Board of Governors of the International Corporate Governance Network and the Advisory Board of the Finance for Biodiversity Foundation.
Jenn joined Fidelity International in 2007 from Norton Rose Fulbright, where he was a corporate finance lawyer advising on capital market and M&A transactions. He holds an LLB Law degree from the University of Durham.
| about
Fidelity International offers investment solutions and services and retirement expertise to more than 2.9 million customers globally. As a privately held, purpose-driven company with a 50-year heritage, we think generationally and invest for the long term. Operating in more than 25 locations and with $714.3 billion in total assets, our clients range from central banks, sovereign wealth funds, large corporates, financial institutions, insurers, and wealth managers, to private individuals.
Our Workplace & Personal Financial Health business provides individuals, advisers and employers with access to world-class investment choices, third-party solutions, administration services and pension guidance. Together with our Investment Solutions & Services business, we invest $514.1 billion on behalf of our clients. By combining our asset management expertise with our solutions for workplace and personal investing, we work together to build better financial futures. Data as at 30 September 2023. Read more at fidelityinternational.com
Fidelity only offers information on products and services and does not provide investment advice based on individual circumstances, other than when specifically stipulated by an appropriately authorised firm, in a formal communication with the client.
Fidelity International refers to the group of companies which form the global investment management organisation that provides information on products and services in designated jurisdictions outside of North America. This communication is not directed at, and must not be acted upon by persons inside the United States and is otherwise only directed at persons residing in jurisdictions where the relevant funds are authorised for distribution or where no such authorisation is required.
Unless otherwise stated all products and services are provided by Fidelity International, and all views expressed are those of Fidelity International. Fidelity, Fidelity International, the Fidelity International logo and F symbol are registered trademarks of FIL Limited.
Issued by Financial Administration Services Limited, authorised and regulated by the Financial Conduct Authority
CC23/95
| All opinions expressed are those of the author and/or quoted sources. investESG.eu is an independent and neutral platform dedicated to generating debate around ESG investing topics.
