A coalition of investors that oversee $10tn in assets has called on companies including Amazon, PepsiCo and McDonald’s to drastically reduce their reliance on plastics, saying a failure to do so exposes them to financial risks. The 183-strong group has written to 30 of the world’s biggest grocery, retail and consumer goods companies to warn that continued production of plastics poses risks to public health, biodiversity, climate change and human rights. The coalition, which includes Amundi, Legal and General Investment Management, Aviva Investors, Axa Investment Management and Rockefeller Asset Management, is the largest ever formed to put pressure on companies over plastics. It has urged the businesses, which also include Tesco, Carrefour and Danone, to phase out single-use plastics, significantly reduce material consumption and implement re-use systems for packaging. Angélique Laskewitz, executive director at Dutch Association of Investors for Sustainable Development (VBDO), the campaign’s co-ordinator, said it was worrying that most companies in the consumer and food retail sectors were taking only limited action to mitigate the risks posed by plastics. “Investors are now sending a clear signal to these companies that they will face ever-increasing pressure if they do not act soon to substantially reduce their plastic footprint,” said Laskewitz. VBDO estimates that plastic pollution costs society more than $100bn a year. A study published in 2017 found that 8.3bn tonnes of plastics had been produced since the industry began to expand after the second world war. About four-fifths has been dumped as waste, while just 9 per cent has been recycled. A growing cohort of institutional investors has raised concerns about plastics and the damage to the world’s oceans, especially after David Attenborough’s Blue Planet television series. Some fund managers, including Axa IM and Lombard Odier, have launched funds to tap into the transformation needed when it comes to plastics and waste. The investors brought together this week say companies that fail to take action on plastics will be exposed “to financial risks that threaten value creation and investment returns, given the wave of action to tighten legislation around the world, the increasing number of lawsuits against companies, and potential threat to brand value.” The investors, who also want companies to phase out hazardous chemicals used in plastics, plan to establish targets for each company, following up with letters and calls. The investor coalition is also calling for companies to stop lobbying against policy proposals aimed at reducing plastic waste and pollution, including the Global Plastics Treaty and the EU’s Packaging and Packaging Waste Regulation, which is currently being overhauled.

Arthur van Mansvelt, senior engagement specialist at Achmea Investment Management, said lobbying efforts by industry associations were weakening efforts to tackle the plastic crisis. “The Global Plastics Treaty offers a historic opportunity to tackle the problem at source. We need companies supporting its ambition on prevention and reuse, not lobby against it,” said van Mansvelt. Danone, which is facing a legal action over plastic pollution, pointed to its website, where it says it has pledged to halve its use of virgin fossil-fuel packaging by 2040. Amazon said it was “committed to minimising single-use plastics in our packaging all around the world” and that it had eliminated the use of more than 1.5mn tons of packaging materials since 2015. Carrefour, McDonald’s and Tesco did not respond to a request for comment. PepsiCo declined to comment.

Banks in focus as the Fed weighs its rates move

If market predictions are correct, the Fed on Wednesday will raise borrowing costs by a quarter of a percentage point, even as growing turmoil in the stocks of regional banks threatens to choke off credit to businesses and consumers, pushing the economy into recession.

The decision comes amid a brutal sell-off in regional banks’ shares,which has wiped billions off smaller lenders’ market valuations. Investors have been worried about the health of these banks since March, when Silicon Valley Bank collapsed in one of the most prominent bank failures in U.S. history.

Regulators had hoped that the sale of the embattled First Republic Bank to JPMorgan Chase this week would contain the panic. But short sellers, investors who profit off bets that stock prices will fall, have continued to take aim at regional lenders like PacWest, Western Alliance and Zions Bancorp. (Shares in PacWest and Western Alliance are down again in premarket trading.)

The market carnage could result in more pain for regional banks.Falling prices may cause C.F.O.s to say, “‘You know what, maybe I should think about diversification and moving my funding’” out of these lenders, Ryan Nash, a research director at Goldman Sachs, said in a webinar on Tuesday.

He added that while “most of the large failures are likely behind us, I do think there is a risk that pressure on stock prices could reinvigorate” worries about the sector’s health.

Meanwhile, the Fed faces political pressure. Ten progressive lawmakers, including Senators Elizabeth Warren and Bernie Sanders, urged the central bank to pause its rate hikes to “avoid engineering a recession that destroys jobs and crushes small businesses.”

The lawmakers cautioned Jay Powell, the Fed chair, that raising borrowing prices could further compound trouble for beleaguered banks.

None of this is likely to deter the Fed from raising rates on Wednesday, analysts said. Indeed, a “shock pause” would “do more harm than good” by spooking an already jittery market, according to Elsa Lignos, the global head of FX strategy at RBC Capital Markets.

But economists increasingly believe that Wednesday’s increase will be the last in this tightening cycle. Watch what Mr. Powell says about upcoming Fed meetings: If he suggests that the central bank needs to remain hawkish on rates to fight inflation, that could send stocks — especially those of regional banks — especially hard.

Ms. Lignos advised paying attention to what Mr. Powell says about whether “additional policy firming may be appropriate,” a line of guidance he used after the March meeting: If that wording is softened or deleted altogether, she said, it may indicate a dovish turn by the Fed.