CA100+ Addresses US Departures

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    Stockholm (NordSIP) – Collaborative engagement initiative Climate Action 100+ (CA100+) has responded to the withdrawal of several large asset management firms in recent weeks.  JP Morgan Asset Management, PIMCO, and State Street Global Advisors decided to leave the initiative entirely, while BlackRock withdrew its US arm, limiting CA100+ participation to BlackRock International.  The latest major US asset manager to head for the exit is Invesco, which announced its decision on Friday 1st March along with a statement that: “We believe our clients’ interests in this area are better served through our existing investor-led and client-centric issuer engagement approach.” NordSIP approached Invesco for further insight into this decision but they declined to comment.

    The move by this group of major asset management firms is believed to have been influenced by some US politicians having accused collaborative engagement initiatives like CA100+ of being in breach of the country’s anti-trust laws, which is strongly refuted by the organisation itself.  CA100+ issued a disclaimer in June 2023, which stated that all of its signatories act as independent fiduciaries and participation does not imply collective decision-making regarding stock selection or shareholder voting.

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    CA100+ shifts up a gear

    At inception CA100+ was intended to be a 5-year initiative ending in 2022.  However, rather than wind it down, the organisation’s steering committee announced in 2022 that it would be extended until 2030.  The CA100+ Phase 2 strategy revealed last year demonstrates an intention to step up a gear by requiring focus companies to provide evidence of the implementation of transition plans.  In 2022 a ShareAction assessment of CA100+ highlighted poorly articulated engagement strategies, inconsistent reporting standards, and a lack of transparency and accountability from signatories.

    CA100+ is keen to underline the progress it has made so far, with 77% of focus companies having pledged to achieve net zero emissions by 2050 or earlier, albeit mainly for Scope 1 and 2 emissions.  Nevertheless, in its 26 February 2024 statement regarding the withdrawals it reiterates its longer-term ambitions: “The initiative has always been action-orientated and about more than disclosure.”  It may be that a more aggressive Phase 2 approach would not have sat comfortably with the large US asset managers’ client base and other stakeholders.

    Despite the large volume of assets under management represented by the departing US asset managers – Invesco alone accounts for $1.6 trillion – CA100+ continues to benefit from strong support from European investors.  In a recent interview with NordSIP, AP7’s Johan Florén pointed to the progress made by the initiative in terms of corporate disclosure and the positioning of climate change firmly on the C-suite agenda.  CA100+ has also benefited from 60 new signatories since it announced the launch of Phase 2, helping to keep its membership base stable in terms of numbers despite the recent departures.

    Richard Tyszkiewicz
    Richard Tyszkiewicz
    Richard has over 30 years’ experience in the international investment industry. He has worked closely with major Nordic investors on consultancy projects, focusing on the evaluation of external asset managers. While doing so, Richard built up a strong practical understanding of the challenges faced by institutional investors seeking to integrate ESG into their portfolios. Richard has an MA degree in Management and Spanish from St Andrews University, and sustainability qualifications from Cambridge University, PRI and the CFA Institute.
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