Forever Chemicals: Why Should Companies and Investors be Concerned? - By Fatima Husain and Dr Rory Sullivan
Forever Chemicals: Why Should Companies and Investors be Concerned? - By Fatima Husain and Dr Rory Sullivan
This article explores investor concerns and actions over the use of ‘Forever Chemicals’. We will host a webinar on the issue on 03rd September, so please click here to register for the webinar or see details at the foot of this blog.
Perfluoroalkyl and Polyfluoroalkyl Substances (PFAS) are a group of chemicals whose typical properties – including chemical inertness, temperature resistance, and oil, water and stain-repellence – makes them useful in a broad range of consumer and industrial applications. Some of the major industry sectors using PFAS include aerospace and defence, automotive, aviation, textiles, construction, household products, electronics, food processing, food packaging and medical devices.
However, the properties that make PFAS so useful have also led to global concern about their adverse health and environmental impacts. PFAS are resistant to environmental degradation and may persist in the environment longer than any other human-made chemical. Exposure to PFAS from contaminated drinking water and food has been linked with human health impacts including endocrine disruption, increased cholesterol, higher risk of certain cancers, thyroid issues, reduced birth weights, lower response to vaccines and cardiovascular disease.
Given their widespread use and persistence in the environment, PFAS contamination is a critical global concern that is drawing increasing regulatory attention. The most far reaching is the EU proposal to restrict PFAS as a family of chemicals. There is also significant litigation risk, not only in the US but in other countries such as Sweden and the Netherlands.
A new report, prepared by Chronos Sustainability, from the First Sentier MUFG Sustainable Investment Institute – PFAS: Forever Chemicals – Investor Briefing – explores the scale of PFAS pollution, its pathways into the environment, its impact on the environment and human health, regulatory and litigation responses and the risks and opportunities presented to PFAS producers, product manufacturers and waste management, water treatment and environmental testing service providers.
The report makes four key recommendations for investor action on the issue:
Advocating for corporate disclosure on PFAS – Investors can advocate for corporate disclosure regarding the use, presence, types, and quantities of PFAS. They can also push for transparency on PFAS emissions across product portfolios and lifecycles, as well as on the availability of alternatives to PFAS within these portfolios.
Encouraging corporate action on PFAS – Investors can urge companies to take a proactive stance on PFAS. This includes acknowledging the risks, committing to a phase-out plan with clear timelines for reformulation and emissions reduction, establishing oversight structures, and transparently reporting on progress and impacts.
Building investor support for policy engagement – Investors can also play a role in policy engagement, encouraging international collaboration as well as supporting regional and country-level regulatory efforts on PFAS.
Building partnerships and collaborating with other investors and other key stakeholders – Investors can enhance their influence by partnering with other investors and key stakeholders, such as NGOs, to accelerate the phase-out of PFAS. These partnerships can coordinate efforts to promote the adoption of safer, sustainable alternatives, especially where regulatory measures lag. For example, the Investor Initiative on Hazardous Chemicals (IIHC), supported by Swedish NGO ChemSec, actively engages with major global manufacturers.
The report PFAS: Forever Chemicals – Investor Briefing can be downloaded from:
Webinar
Chronos Sustainability and First Sentier MUFG Sustainable Investment Institute will be hosting a webinar to discuss these issues on 03rd September 2024, 09:00-10:00 (BST)
Speakers include:
* Sudip Hazra, Director, First Sentier MUFG Sustainable Investment Institute
* Clare Wood, Portfolio Specialist, Stewart Investors
* Dr Rory Sullivan, CEO, Chronos Sustainability
* Eugenie Mathieu, Nature Stewardship Lead, Aviva Investors
* Patrik Witkowsky, Senior Sustainable Finance Advisor, Chemsec
Please register here: https://attendee.gotowebinar.com/register/1769302666947314267
Notes
First Sentier MUFG Sustainable Investment Institute
The First Sentier MUFG Sustainable Investment Institute is a joint venture initiative between First Sentier Investors and Mitsubishi UFJ Trust and Banking Corporation. The institute was launched in May 2021 to provide insights to investors that will contribute to a better understanding of how sustainability should be considered in investment approaches. The Institute works with global research groups, consultants and academics to examine Environmental, Social and Governance (ESG) issues and better understand how investment practices can contribute to a more sustainable world.