Stockholm (NordSIP) – “The asset management sector does not appear to want to fix itself.” This is one of the conclusions of ShareAction’s 2025 edition of its annual evaluation of investment managers’ sustainability credentials. The UK-based non-profit has been producing its series of Point of No Returns reports since 2020, in which the world’s 76 largest asset management firms are rated according to their approach to governance, climate change, biodiversity, and social issues.
With overall standards stagnating or for certain categories declining over the past five years, ShareAction is urging asset owners to use this latest report to inform the selection, monitoring, and review process of their external managers. The peer group under review was put together according to size of assets under management as well as geographical region, with ShareAction aiming for representation across the United States (US), Europe, and Asia.
According to the 2025 evaluation results, sustainability-minded asset owners are best served by European providers, with the Netherlands, France, UK, Germany, Finland, and Sweden making up the Top 10 best rated asset managers. These include Robeco, which has now achieved a hat-trick of successive #1 rankings in the ShareAction survey over the past three years. Fellow Dutch firm APG Asset Management comes a close second while also achieving an overall ‘A’ grade.
Nordic highlights
With overall B grades Nordic managers Nordea and SEB are also in the leading group at #6 and #8 respectively. Nordea stood out for its attention to social issues, while SEB was commended for the scope and ambition of its net-zero targets. SEB was one of only four managers out of the 76-strong peer group that met the required standard of having a 50% emissions target by 2030 covering at least half of their listed equity and corporate bond holdings. Most managers were criticised for this lack of ambition as well as their reliance on lax methodology and a failure to include Scope 3 emissions.
Exposure to listed fossil energy companies was also widespread among the peer group, with nine US and Asian managers having no fossil fuel exclusions whatsoever. Stated climate goals also appeared to contradict investment policies that allowed a significant majority of respondents to invest in so-called unconventional oil and gas production, including the exploitation of tar sands, Arctic exploration, fracking, and ultra-deepwater projects.
The ‘Big Four’ world’s largest asset managers, all of which score either E or F overall, are singled out for their appetite for bonds issued by some of the most expansive oil and gas producers including ExxonMobil, BP, and Petróleos Mexicanos (PEMEX). Together, the Big four account for a third of the total assets managed by the peer group, which means that their extremely poor performance has a disproportionate overall impact.
Biodiversity blind spot persists
The list of 20 sustainability standards against which the 76 managers are measured include biodiversity-related policies. Unfortunately, only three managers were found to include nature and biodiversity considerations withing their climate scenario analysis and transition plans. Despite a few instances of recent progress in terms of biodiversity disclosure, more than half of the peer group failed to demonstrate any nature-related action or policies at all. This ‘blind spot’ had already been highlighted in ShareAction’s 2023 report, but this year’s results show that little progress has been made.
Many of the surveyed managers display a lack of conviction or consistency regarding sustainability themes. This is manifested either by the application of ESG criteria only to certain specialist funds, or a failure to implement responsible investment policies in practice. This mismatch between words and actions is at the heart of ShareAction’s criticism of the asset management industry. The peer group in the 2025 report displays a tendency to set targets and implement reporting and disclosure measures while failing to ensure that these inform the actual investment decision-making process in a meaningful way. This passive approach is also evident in a corporate engagement process that seldom leads to effective consequences for investee companies and issuers.
While highlighting the small minority of mainly European managers that are taking sustainability seriously, ShareAction hopes that the effective naming-and-shaming of large asset managers in the 2025 Point of No Returns report will help encourage improvements and closer scrutiny from asset owners, market regulators, and policymakers.
