Congress Caucus to Explore Climate Financial Impact

The new congressional caucus formed last week to explore sustainable investment issues such as impact investing has been hailed as “a key moment of support and oversight” by impact investing groups.

The Congressional Sustainable Investment Caucus was launched on January 25 and is co-chaired by Representatives Juan Vargas and Sean Casten.

It is designed to allow members of Congress to work with industry experts to explore sustainable investing themes and inform policy making “that provides investor protections and transparency of information to market participants”, according to a statement issued by Vargas.

Mindy Lubber, president and CEO of sustainable and impact investing non-profit Ceres, said: “For decades, Ceres has been working with many of the largest investors and companies in the world to advance sustainable investment and business practices and advocate for the policies and regulations to accelerate those efforts.

“Investors in the US and around the world are increasingly aware that sustainability issues like climate change, water scarcity, and biodiversity loss will impact companies, supply chains, workforces, and infrastructure — and that failing to account for the risks and opportunities they present would betray the interests of their beneficiaries and other stakeholders. It is good to see that there is growing recognition of and urgency around this perspective in Congress, as well.”

Lisa Woll, CEO of US SIF, which helped set up the caucus, said: “Sustainable investment is in the mainstream of finance because investors that don’t account for the environmental, social and governance practices and policies of the companies they invest in are not adequately assessing risk and missing an opportunity to both make better investments and to contribute to a more sustainable economy.

“With [the caucus’s] launch, Congress will be better resourced to understand the demand for and market relevance of sustainable investing as well as its relevance to policy.”

The formation of the caucus comes against a backdrop of increasingly polarized stances on ESG issues from US policymakers. States including Kentucky, Florida, Louisiana, Oklahoma, West Virginia and Missouri have enacted or plan to enact bans on state entities doing business with financial services companies that exclude investments in fossil fuel companies.