A total of 43 asset managers have revealed their initial targets to achieve net zero by 2050 or sooner, bringing the number of asset managers that have set targets to 83, according to Net Zero Asset Managers (NZAM).
The latest targets mean that, out of a possible £33.3 trillion managed by asset managers who have set targets to date, around £12.7 trillion is now committed to be managed in line with achieving net zero by 2050 or sooner, and subject to targets consistent with a fair share of the 50 per cent global emission reduction by 2030 identified as necessary in the IPCC special report on global warming of 1.5°C. This amount represents almost 39 per cent of the assets of those managers, up from 35 per cent when the first set of targets was released at COP26.
AXA Investment Managers and Wellington Management raised their targets for the share of assets managed in line with attaining net zero by 2050 or sooner, respectively, from 15 per cent to 65 per cent and 10.6 per cent to 32.4 per cent.
Since November 2021, 53 asset managers have joined the project, bringing the total to 273, representing £48.6 trillion in assets under management. T. Rowe Price, Credit Suisse Asset Management, and Frontier Investment Management are among the new signatories.
AXA Investment Management executive chairman Marco Morelli says: “Since our first submission in October, we have further intensified our efforts across the whole business to develop an approach which is robust and can be implemented in an effective manner by investment teams, meaning our revised figure now stands at 65 per cent of total assets managed in line with net zero by 2050.
“Announcements and decisions made by policy-makers in different locations to encourage the financial sector to continue to play a leading role in the transition, for instance Article 29 of the Law Energy-Climate in France, gave us more comfort on some of our points of attention in relation to assets outside of what we first deemed as eligible.
“We also moved from a bottom-up approach at fund level to a top-down approach at asset class level, specifically in relation to third party assets. Going forward, our aim is to continue to grow the proportion of net zero-aligned AUM as reliable methodologies become available for all asset classes.”
Generation Investment Management director Edward Mason: “Achieving net zero emissions by 2050 on a 1.5C pathway across the global economy and the halving of global emissions this decade will require sustained action across all elements of the NZAM commitment by all signatories. We have unquestionably seen a positive start towards these monumental goals, but we are now into the hard work, year on year, of delivery.”
Macquarie Asset Management group head Ben Way says: “As we aspire to become a global leader in sustainable asset management, we know that action, supported by evidence, is the most important step. Initiatives like Net Zero Asset Managers play an important role in helping us track our progress against delivering on our ambition to manage and invest our portfolio in line with net zero emissions by 2040.
“We welcome the release of this progress report which highlights the positive progress we have made across our global portfolio since we became a signatory to the initiative just 12 months ago. Delivering on our net zero ambition is complex and influenced by many factors, however we remain focused on partnering with our investors, portfolio companies, regulators, peers, and a wide range of stakeholders to drive this mission critical work.”
Wellington Management vice chair and head of sustainable investment Wendy Cromwell says: “We are proud of our net zero commitment of $346bn and the solid foundation we are building. We look forward to continuing to work with asset owners on their decarbonization goals, engaging with companies to assess preparedness for a low carbon transition, and serving on net zero related advisory boards and working groups to help enhance tools and methodologies. We plan to share periodic updates on our asset level commitment as our methodical client-by-client and strategy-by-strategy work continues.”