Stockholm (NordSIP) – At a time when ESG and sustainable investments have come under attack, a trend has emerged for investors to trim their participation in international financial networks seeking to support the transition to a more sustainable future.
Sometimes, these exits have been motivated by fear of political reprisals from conservative politicians. Other times, the decision is simply motivated by the wish to better focus their cooperative efforts.
The latter was the motivation given by Danish pension provider PKA when it confirmed to NordSIP it had left the Net-Zero Asset Owner Alliance (NZAOA) to focus on its membership of the Institutional Investors Group on Climate Change (IIGCC).
Focusing on IIGCC Membership
“We have decided to withdraw from the NZAOA to focus on IIGCC and their initiative Paris Aligned Asset Owners initiative, thereby maximizing the impact of our resources and collective efforts in the areas of climate and biodiversity,” Nicholas Rindahl, Head of Press at PKA, tells NordSIP.
The main difference between the two organisations appears to be in scope. According to the NZAOA‘s latest membership statistics, it counted 88 asset owners, worth US$9.5 trillion in assets under management (AUM). 83 members have published targets and US$8.4 trillion of AUM had committed to operating according to the target-setting framework¹. The IIGCC counts over 400 members, with US$65 trillion in AUM. The IIGCC also focuses on both asset owners and asset managers.
PKA Remains Committed
“We have been members of multiple initiatives to support a broader focus on climate action among investors. However as climate action and reporting are scaling up we have chosen to dedicate our efforts to IIGCC, where we have been a prominent member for years and where we wish to continue playing a leading role,” Rindahl adds. PKA is also a member of such as the PRI or Dansif. “We don’t plan on leaving other organisations.,” Rindahl clarifies.
NZAOA and its members seek to achieve net-zero emissions by 2050, a clear goal that was not originally articulated by the IIGCC. However, in 2021, March 2021 the IIGCC launched the Paris Aigned Asset Owners Commitment together with the publication of the Net Zero Investment Framework, counting 57 asset owners, with over $3.3 trillion in AUM.
This overlap between the organisations can perhaps lend some credence when PKA argues it stands by its previous commitments and targets. “Our ambitions and targets in the area of climate action and CO2-reduction remain the same,” Rindahl concludes.
¹While it is not entirely clear, it is likely that these figures include PKA as a member.
