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    Asset Managers Unite Against Carbon Emissions

    Stockholm (NordSIP) – Recently, a range of sustainable finance initiatives make inroads towards carbon neutrality, not least the Net-Zero Asset Owner Alliance and the Institutional Investors Group on Climate Change (IIGCC).  On December 11, thirty asset managers representing US$9 trillion in assets under management (AUM) joined this chorus by announcing the launch of the Net Zero Asset Managers initiative. The signatories are committed to supporting the goal of net-zero greenhouse gas emissions by 2050 or sooner, in line with global efforts to limit global warming to 1.5°C.

    Signatories agreed to three main courses of action in recognition of “an urgent need to accelerate the transition towards global net-zero emissions and for asset managers to play our part to help deliver the goals of the Paris Agreement and ensure a just transition.” Beyond their general commitment to net-zero emissions, members of the initiative also agreed to set interim targets for the share of assets that should be managed in line with this goal over the coming thirty years. To support progress along these milestones, signatories also agree to review their performance and targets every five years, increasing the proportion of AUM covered until 100% of assets are included.

    Founding signatories include a.s.r. Asset Management, Anaxis Asset Management, Arisaig Partners, Asset Management One, ATLAS Infrastructure, AXA Investment Managers, BMO Global Asset Management1, Calvert Research and Management, CCLA Investment Management, Clean Energy Ventures, DWS, FAMA Investimentos, Fidelity International, Generation Investment Management LLP, Gulf International Bank Asset Management, Handelsbanken Fonder AB, IFM Investors, Inherent Group LP, Kempen Capital Management, Legal & General Investment Management, M&G plc, New Forests Pty Ltc, Nordea Asset Management, Robeco, Sarasin & Partners LLP, Schroders, Swedbank Robur, UBS Asset Management, Wellington Management, and WHEB.

    “Investors have the power to effect real change and we are seeing an increasingly strong appetite to direct capital towards a lower-carbon future,” says Suni Harford, President, UBS Asset Management. “Joining the Net Zero Asset Managers initiative as a founding member represents a further exciting step for UBS Asset Management and reflects the commitment we made at the start of 2020 to support our clients in achieving their own decarbonisation goals. This includes developing the innovative products and solutions that our clients need, such as our newly-expanded suite of Climate Aware strategies.”

    “Asset managers have a unique and critical role to play in the transition to global net-zero emissions. We look forward to building partnerships both with our asset owner clients, and with the companies we invest in, to move together on the journey to making this a long-term shared goal,” Kristi Mitchem, CEO, BMO Global Asset Management, adds.

    “As an active asset manager who invests across the public and private markets spectrum globally, we have an important role to play in encouraging companies to plan for and execute on the transition towards net-zero carbon emissions and limit climate change,” Schroders‘ CEO, Peter Harrison, explains. “This is why the Net Zero Asset Manager initiative is important to us – it supports us in partnering with our clients and the companies that we invest in to drive towards a more sustainable future for all, and encourages our peers and the wider industry to do the same.”

    “It is great to asset managers coming together in initiatives like this and aligning us to the net-zero asset owner alliance. The financial industry, by joining forces, has a key role to play in reaching the goal of decarbonizing the economy,” Henrik Jonsson, Country Head Nordic Region at Schroders added. “Nordic investors have past few years been increasingly vocal about their preferences for sustainable investments. This initiative will support these preferences by putting more emphasis on sustainability as asset managers encourage companies to plan for and execute on the transition towards net-zero carbon emissions. It will also act as a strong signal to the wider investment community.”

    “Nordea Asset Management is very happy to be a founding member of this important group, which will be a natural counterpart to the Net Zero Asset Owner’s initiative, and will help support the asset management industry in its necessary move towards full Paris compliance,” says Nils Bolmstrand, CEO, Nordea Asset Management. “The targets of the NZAM align fully with NZAM’s internal climate targets, and we expect to see further development along these lines in the coming years.”

    “In collaboration with Woodwell Climate Research Center, a leading climate science think tank, we have been researching the physical effects of climate change on capital markets and integrating those findings into our investment practices,” Jean Hynes, Managing Partner and incoming CEO at Wellington adds. “This work has strengthened our conviction that climate science can inform our stewardship strategy and enhance the investment decisions we make on behalf of our clients. We strongly believe that engagement is a critical mechanism for helping companies appreciate the potential effects of the low-carbon transition on security valuations. As a large active manager, we will continue to work with companies to encourage net zero commitments and monitor their implementation.”

    The initiative will be managed by six Founding Partner investor networks, namely: Asia Investor Group on Climate Change (AIGCC), CDP, Ceres, Investor Group on Climate Change (IGCC), Institutional Investors Group on Climate Change (IIGCC), and Principles for Responsible Investment (PRI). The initiative is also endorsed by The Investor Agenda, of which the investor networks are all founding partners.

    Image by catazul from Pixabay

    Filipe Albuquerque
    Filipe is an economist with 8 years of experience in macroeconomic and financial analysis for the Economist Intelligence Unit, the UN World Institute for Development Economic Research, the Stockholm School of Economics and the School of Oriental and African Studies. Filipe holds a MSc in European Political Economy from the LSE and a MSc in Economics from the University of London, where he currently is a PhD candidate.

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