Net Zero Asset Managers initiative publishes initial targets for 43 signatories as the number of asset managers committing to net zero grows to 273

  • Less than 18 months since the initiative launched, 83 asset managers have set initial targets, with 39% of their assets (USD 16 trillion) now committed to be managed in line with achieving net zero by 2050 or sooner 
  • Most targets are from those who joined the initiative in March and April 2021, with some asset managers also disclosing early or updating their initial targets  
  • 53 asset managers have joined the initiative since November 2021, bringing the total to 273, representing more than USD 61.3 trillion in assets under management 
  • New signatories include T. Rowe Price, Credit Suisse Asset Management and Frontier Investment Management  

43 asset managers have disclosed their initial targets for the proportion of assets managed in line with achieving net zero by 2050 or sooner, according to the latest Net Zero Asset Managers (NZAM) initiative target disclosure report. This follows the inaugural NZAM report published in November 2021.   

The latest targets mean that, collectively, approximately USD 16 trillion – out of a possible USD 42 trillion managed by the asset managers who have set targets to date – 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% global emission reduction by 2030 identified as necessary in the IPCC special report on global warming of 1.5°C. This sum represents approximately 39% of those managers’ assets – up from 35% when the first set of targets were published at COP26.  

Some managers who had already set targets, including AXA Investment Managers and Wellington Management have demonstrated greater ambition by updating their initial targets from November 20211. Both AXA and Wellington have increased their targets for the proportion of assets managed in line with achieving net zero by 2050 or sooner – from 15% to 65% and 10.6% to 32.4% respectively.  

Investor signatories 

Marco Morelli, Executive Chairman, AXA Investment Management, said: “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% 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.” 

Edward Mason, Director, Generation Investment Management, said: “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.” 

Ben Way, Group Head, Macquarie Asset Management, said: “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.”  

Wendy Cromwell, Vice Chair and head of sustainable investment at Wellington Management, said: “We are proud of our net zero commitment of $436 billion 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.”  

Key themes 

Throughout the target disclosure and review process, several notable themes were highlighted by a number of asset managers as key drivers behind the targets presented and the approaches taken to setting them.  

One relates to the variation in business models owing to the difference in the number of clients across the different managers. While some have relatively few clients, other managers have thousands of different clients invested across hundreds of funds, which can make adjusting funds to align with net zero a lengthier process. However, many have indicated that there are ongoing conversations with clients and other stakeholders which they expect to result in significant increases in the proportion of AUM managed in line with net zero in future. 

Another key theme managers highlighted was the difference between setting targets for actively and passively managed investments. While active managers have greater power to decide how the money is allocated, alignment of index funds requires a different approach and could take longer to achieve. Addressing these challenges will be an area of focus for NZAM network partners in the coming months, and they will be working collaboratively with key stakeholders across the sector to address them.  

Other key themes noted include the differences in target-setting approaches – the three target setting methodologies endorsed by NZAM are the Paris Aligned Investment Initiative Net Zero Investment Framework, Science Based Target initiative for Financial Institutions and the UN-convened Net Zero Asset Owner Alliance Target Setting Protocol – and the importance of available methodologies across all asset classes, including derivatives, private equity, green bonds, sovereign bonds, covered bonds, structured products and cash. More information on the themes is available in the report 

As the importance of decarbonising the global economy has only increased – as highlighted by two recent IPCC reports – the momentum of the NZAM initiative has continued with 53 new signatories joining since November 2021. This takes the total to 273 representing more than USD 61.3 trillion in assets under management. 

Network Partners 

Stephanie Pfeifer, CEO, IIGCC, said: “It is encouraging to see further commitments from the global asset management industry towards climate change and the decarbonisation of the global economy. While there is some way to go, that $16 trillion of assets are now committed to be managed in line with achieving net zero by 2050, is a more than positive start – although targets must of course still translate into action. I particularly welcome those who have been proactive and ratcheted-up their initial targets for in scope assets from those set only six months. I would encourage other managers with existing or yet to be set targets to be just as ambitious and proactive.”     

Rebecca Mikula-Wright, CEO, the Asia Investor Group on Climate Change (AIGCC) and the Investor Group on Climate Change (IGCC), said: “In the 18 months since NZAM launched, the world’s biggest asset managers have started the on journey of setting targets and getting their portfolios on track for net zero by 2050. This momentum must continue; climate is a risk that can’t be divested from, so investors will need to use their influence over capital flows, their influence on companies and their voice to policy-makers to speed up the transition to a net zero global economy.” 

Paul Simpson, Chief Executive Officer, CDP, said: “CDP is encouraged by the growing number of asset managers committing to decarbonize their portfolios, setting net-zero targets and increasing the proportion of their assets to be managed in line with those targets. However, the world is not yet on track to meet the goals of the Paris Agreement to limit warming to 1.5 degrees and we are running out of time to do so. As a sector that plays a critical role in the just transition to a net-zero and nature positive world, we look forward to seeing increasingly ambitious targets from asset managers, which translate into action and accountability.”   

Mindy Lubber, CEO and President, Ceres, said: “We applaud the asset managers who have set targets for a majority of their assets to align with the global goal of limiting temperature rise to no more than 1.5 degrees. We are most encouraged by the steady growth in the number of asset managers setting targets and increasing the percentage of their assets covered by those targets. The world is on a dangerous precipice regarding climate change risk, and all investors need to think about long-term returns and strategies for growth instead of short-term gains or quick and fleeting profits. The viability of the global economy and health of the planet and its people significantly depend on achieving a 50% reduction in global greenhouse gas emissions by 2030.”    

David Atkin, CEO, Principles for Responsible Investment (PRI), said: David Atkin, CEO, Principles for Responsible Investment (PRI), said: “The targets announced today through NZAM are a clear statement of intent from investors. We know that climate risk is financial risk, and that strong, decisive action is needed to keep the possibility of limiting warming to no more than 1.5 degrees alive. These commitments by investors are a key step towards the realisation of a truly net zero financial system. We’ll continue to work with NZAM signatories and the sector at large to push for even more ambitious action, taken further and faster, to help deliver meaningful action on the road to net zero.” 

ENDS 

1 The NZAM commitment requires managers to review their target at least every five years and encourages them to do so more frequently where possible. 

Media contacts 

For more information or further comment contact: 

Asia Investor Group on Climate Change (AIGCC): Tammie Kang, Communications Manager – tammie.kang@aigcc.net  

CDP: Sara Firouzyar, Senior Communications Manager – Sara.Firouzyar@cdp.net  

Ceres: Barbara Grady, Communications Manager – grady@ceres.org  

Investor Group on Climate Change (IGCC): Fergus Pitt, Director of Media and Communications – fergus.pitt@igcc.org.au  

Institutional Investors Group on Climate Change (IIGCC): Ross Gillam, Head of Media Relations – rgillam@IIGCC.org  

Principles for Responsible Investment (PRI): Joseph Cockerline, Communications Specialist – joseph.cockerline@unpri.org  

About the Net Zero Asset Managers initiative 

The Net Zero Asset Managers initiative is an international group of asset managers committed to supporting the goal of net zero greenhouse gas emissions by 2050 or sooner, in line with global efforts to limit warming to 1.5°C; and to supporting investing aligned with net zero emissions by 2050 or sooner. The Net Zero Asset Managers initiative launched in December 2020 and aims to galvanise the asset management industry to commit to a goal of net zero emissions. The initiative is endorsed by Investor Agenda and governed by six investor networks – also referred to as the ‘Network Partners’. The Steering Committee of the Network Partners’ CEOs is responsible for the coordination and implementation of the initiative, which includes ensuring that relevant support is provided to signatories to enable best practice implementation of the commitment. The initiative is open to any asset manager globally that is also a member of one of the Network Partner networks. For more information on the initiative please contact us 

https://www.netzeroassetmanagers.org/  

Net Zero Asset Managers initiative adds 16 new signatories taking total AUM represented to USD 57.5 trillion

  • The 16 new signatories cover a broad geographic base including, the UK and continental Europe, Australasia and North America.

The Net Zero Asset Managers initiative has added 16 new signatories taking the total number of signatories to 236 with USD 57.5 trillion total AUM represented. This follows a year of significant and real progress in 2021 for the Net Zero Asset Managers initiative having only launched in December 2020.

The 16 new signatories are: BBGI Global Infrastructure S.A, Breckinridge Capital Advisors, Ethos Services SA, Findlay Park Partners, INOKS Capital SA, Kiwi Wealth Investments Limited NZ, Lindsell Train Limited, Mandarine Gestion, Nutshell Asset Management Limited, OP Real Estate Asset Management Ltd., Redwood Grove Capital, Sustainable Development Capital LLP, UBP Asset Management (Europe), Unicorn Asset Management, Whitehelm Capital and V-Square Quantitative Management LLC

Full details of the steps the investors commit to in joining the initiative can be found here.

The Net Zero Asset Managers initiative is managed globally by six founding partner investor networks: Asia Investor Group on Climate Change (AIGCC), CDP, Ceres, Investor Group on Climate Change (IGCC), Institutional Investor Group on Climate Change (IIGCC) and Principles for Responsible Investment (PRI).

Net Zero Asset Managers initiative signatories disclose interim targets, with over a third of assets managed in line with net zero

  • 43 asset managers share first interim targets for the proportion of assets managed in line with achieving net zero by 2050, and set shorter term targets for reducing emissions within their investments
  • Signatories disclose that 35% of their total assets under management, totalling USD 4.2 trillion out of a possible USD 11.9 trillion, is being managed in line with achieving net zero by 2050
  • A record 92 new asset managers representing USD 10.8 trillion in assets join initiative, bringing the total to 220 investors managing USD 57.4 trillion
  • Network partners managing the initiative set out expectations on fossil fuel investment, asking signatories to adopt robust and science-based policies aligned with a 1.5°C scenario

43 investors have disclosed their first interim targets for the proportion of assets managed in line with achieving net zero by 2050, according to a new progress report released today. The asset managers have committed USD 4.2 trillion out of a possible USD 11.9 trillion, meaning that 35% of their total assets under management is in line with net zero.

As signatories to the initiative, asset managers also commit to set interim targets consistent with afair share of the 50% global reduction in greenhouse gas emissionsby 2030, with 15 setting shorterterm targets for 2025. Investors must disclose their initial interim target within a year of joining the initiative and review on a regular basis with a view to increasing the proportion of assets until 100% are included. If this initial target were reflected across all current signatories, more than USD 20 trillion managed would be in line with net zero and subject to 2030 targets by the end of 2022.

“Aviva Investors warmly welcomes the release of this Progress Report of the Net Zero Asset Managers initiative. With the release of the IPCC’s sixth Assessment Report, we now know that everyone needs to do all that they can to tackle this crisis, shift the trajectory of emissions and align financial flows with 1.5°C. To do this successfully we need to harness markets to deliver a smooth and just transition. Asset management is an important part of that, and the growth of the Net Zero Asset Managers initiative and the wider finance sector committed to GFANZ provides both hope and an example of leadership for others to follow.” said Steve Waygood, Chief Responsible Investment Officer, Aviva Investors.

“For many years we have invested in our own capabilities to help us measure and manage climate risks and to push companies to transition. We welcome the transparency and accountability that externally validated methodologies such as the Science Based Targets initiative demand, and as founding signatories to the Net Zero Asset Managers initiative, we recognise the essential role that collective action by our industry plays at this defining moment.” said Andrew Howard, Global Head of Sustainable Investment, Schroders.

“The climate is the greatest challenge of our time and is being debated extensively. However, the debate must not be at the expense of action, and here initiatives such as Net Zero Asset Managers are an important key in driving development forward. I am very proud of Swedbank Robur’s disclosure, which shows that we have already made a major move and reduced carbon emissions by 50% since 2017, and that we are well on the way to our goal of securing our managed capital in line with the Paris Agreement as early as 2025. But we have to keep pushing, and our way forward will include an even stronger focus on investing in climate solutions and influencing our portfolio companies to set goals in line with the Paris Agreement.” said Liza Jonson, CEO, Swedbank Robur.

“Since our founding commitment, we have been working diligently to turn aspiration into accountable action. We are pleased to report our initial commitment of net-zero-aligned assets and are excited about the solid foundation we have built for further progress. We plan to continue to develop measurable net-zero implementation plans client by client, and investment strategy by investment strategy. As a large active manager we believe we have an important role to play in helping companies prepare for this significant economic transition.” said Jean Hynes, CEO, Wellington Management.

The Net Zero Asset Managers initiative Progress Report comes as COP26 begins and at a critical time or increasing investor action on the climate crisis. In addition, a record 92 asset managers representing USD 10.8 trillion in assets are joining the initiative today, bringing the total to 220 investors managing USD 57.4 trillion. These latest numbers indicate that investors representing nearly 60% of the world’s total managed assets are now committed toward achieving the goal of net zero emissions by 2050 or sooner.

New signatories include J.P. Morgan Asset Management, Metrics, Mitsubishi UFJ Trust and Banking, Nikko Asset Management, Nomura Asset Management, Rockefeller Asset Management and Vancity, significantly boosting the representation of Asian and US-based asset managers within the initiative.

“This is a critical time to join forces to combat climate change and the consequences of global warming. We have a collective responsibility to work alongside issuers to deliver the net zero ambition for future generations. Eurizon firmly believes in sustainable and responsible investments and we are ready to play our part.” said Saverio Perissinotto, CEO, Eurizon Capital SGR.

“Addressing climate-related risks and opportunities is a critically important issue in the evolution of the asset management industry. Thoughtful government policy, investments in low-carbon technologies, and collaboration between the public and private sectors are all prerequisites to a transition to a low carbon world. Asset managers, together with our institutional and individual clients, also have an important role to play. We are pleased to have joined the Net Zero Asset Managers Initiative as we seek to work with clients to deliver products and solutions that support their net zero ambitions.” said George Gatch, CEO, J.P. Morgan Asset Management.

“Metrics is determined to play a leading role in promoting and assisting with the transition to a low carbon economy. This presents an enormous opportunity and Metrics is committed to ensuring that we both lead by example and ensure our stakeholders have the means to participate in achieving a just and timely transition.” said Andrew Lockhart, Co-Founder and Managing Partner, Metrics.

“We believe that addressing climate change is essential to achieving a sustainable society over the medium- to long-term and contributing to the expansion of customer assets through increasing the value of our investees. We, together with the asset management companies in our group, will promote efforts to mitigate climate change by making maximum use of approaches that we can take as investors, such as engagement and voting rights. Through participation in the Net Zero Asset Managers initiative, we will strengthen collaboration with a wide range of stakeholders more than ever before, contribute to a smooth transition to a decarbonized society, and fulfil our fiduciary responsibility.” said Iwao Nagashima, President and CEO, Mitsubishi UFJ Trust and Banking.

“Sustainable investment is at the core of our business and we believe it is inherent to long-term value creation. We are excited to make a commitment to achieve global net zero emissions by 2050 and honored to be part of this growing group of global asset managers. While we acknowledge there are many hurdles and challenges, by collaborating with our clients, investee companies, and other initiative members we can accelerate progress to meet this ambitious goal.” said Hiroki Tsujimura, Global Head of Investment and CIO, Nikko Asset Management Co., Ltd.

“Nomura Asset Management is proud to be part of the Net Zero Asset Managers initiative and we firmly believe that asset managers play a key role in changing the world and achieving a decarbonized and climate-resilient society. As one of the largest asset managers in APAC, we are advantageously positioned to create a positive impact through effective stewardship activities and leveraging our profound climate-related expertise in collaboration with stakeholders. With our interim target and goal as guides, I am confident we will be successful in accelerating this important transition and achieving global net zero emissions by 2050, if not sooner” said Hiroyasu Koike, President and CEO, Nomura Asset Management.

“We are proud to be joining this initiative, which is driving greater insights into the climate trajectory of our underlying holdings and contributing to robust shareholder engagements activity related to climate risk and GHG emissions,” said Casey Clark, Deputy CIO and Global Head of ESG Investments, Rockefeller Asset Management.

“The financial sector holds critical keys to reducing emissions across the economy, deciding what gets unded and where capital is directed. As a founding signatory of the Net Zero Banking Alliance, it was a natural decision for us to join the Net Zero Asset Managers initiative and to foster collaboration to support the ongoing effort to limit warming to 1.5°C.” said Joe Reid, Vice President of Wealth Management and Impact Investing, Vancity.

Today, the network partners also published a set of expectations for investors in relation to fossil fuel investment, asking that signatories adopt robust and science-based policies which are aligned with the Intergovernmental Panel on Climate Change (IPCC)’s 1.5°C scenario.

“It has been remarkable to see the level of commitment coming from the global asset management community when it comes to tackling climate change and decarbonising the global economy. We continue to see a significant number of investors making net zero commitments, but importantly are now also seeing action on those commitments as asset managers begin to share their targets. However, there is still work to do if we are to meet the goals of the Paris Agreement. I look forward to seeing these targets put into action and would encourage the investors who will be disclosing over the coming months to match – or exceed – the ambition set out by the first wave of signatories.” said Stephanie Pfeifer, CEO, IIGCC.

“We welcome the asset managers who have stepped up and committed to reaching net zero emissions, helping the world address the climate crisis. The collaboration of global asset managers is a critical contribution as the world transitions to a decarbonised economy. We look forward to seeing strong action and increasing commitments from investors to achieve their targets.” said Rebecca Mikula-Wright, CEO, the Asia Investor Group on Climate Change (AIGCC) and the Investor Group on Climate Change (IGCC).

“Asset managers play a critical role in achieving a 1.5°C future. It is encouraging to see leading investors commit to aligning their portfolios with net zero by setting interim targets. To address the climate crisis, we must see increasing ambition and action from global investors towards meeting the goals of the Paris Agreement through robust disclosure, setting science-based portfolio targets and aligning all investment activity with a 1.5°C scenario. It’s critical that asset managers work with their asset owner clients and engage with their investee companies urgently to decarbonize at scale and support the transition to a resilient economy. As this initiative grows, we anticipate increased ambition from investors reflected in an ever greater proportion of assets under management covered by mid-term targets.” said Paul Simpson, Chief Executive Officer, CDP.

“Investors increasingly grasp not only the risks posed by the climate crisis, but also the economic opportunities in the global transition to a net zero emissions economy. This first group of asset managers disclosing interim targets for aligning their investments with net zero emissions will help accelerate that transition. To limit global warming to 1.5°C, we need all asset managers and owners, governments, businesses and sectors of society to scale up climate action. At the start of COP26, I call on all investors worldwide to commit to setting a net zero target, including science-based interim targets, and to laying out comprehensive investor climate action plans,” said Mindy Lubber, CEO and President, Ceres.

“The most recent round of target setting by NZAM signatories is a welcome step forward in the mission to reach net zero. Of particular note should be firms’ commitment to net zero plans by 2025 or 2030. We know it is vital for investors to set near-term targets, ahead of 2050, in order to have a realistic chance of making the shift to net zero in time to keep global temperature rises below 1.5°C of warming. We now need to see pledges go deeper and further – with a higher proportion of assets aligned with net zero and further meaningful collective action on the topic, to ensure the industry is on track for 2050.” said Fiona Reynolds, CEO, Principles for Responsible Investment (PRI).

 

– ENDS –

Notes to Editor

Full list of new signatories:

ACTIAM, Addenda Capital, Aegon Asset Management, Aker Horizons, Aktia Bank Plc, Alpha Trust, Angel Oak Capital, Apostle Funds Management, Acadian Asset Management, Arjuna Capital, Artemis Investment Management LLP, Baillie Gifford & Co, BBVA Asset Management, BentallGreenOak, Bin Yuan Capital, BNK Asset Management, BNP Paribas Asset Management, Border to Coast Pensions Partnership Limited, Brawn Capital, Bregal Investments LLP, Brewin Dolphin, Bridges Fund Management, Brown Advisory, Camco Clean Energy, CANDRIAM, Columbia Threadneedle Investments, Community Capital Management LLC, CQS, Deka Investment GmbH, Deka Vermögensmanagement GmbH, Desjardins Global Asset Management, Dream Unlimited, DUGUUD, ESPIRIA, Ethical Partners, Eurizon Capital, EV Private Equity, Fideuram Asset Management Ireland, Fideuram Asset Management SGR, FSN Capital Partners, GMO, Great Lakes Advisors, Green Investment Partners, Greencoat Capital LLP, Grupo Bancolombia, Hannon Armstrong, Hg, Ibercaja AM, ICG, IG4CAPITAL, Impax Asset Management, Investindustrial, J.P. Morgan Asset Management, LaSalle Investment Management, Linzor Capital Partners, Local Pensions Partnership Investments Ltd, Mackenzie Investments, Maple-Brown Abbott, Metric Credit Partners Pty Limited, Metzler Asset Management, MidOcean Partners, Mitsubishi UFJ Asset Management (UK) Ltd., Mitsubishi UFJ Kokusai Asset Management, Mitsubishi UFJ Trust & Banking Corp, MU Investments, Munich Re Investment Partners, Muzinich & Co. Inc, NEI Investments, Neuberger Berman, Nikko Asset Management Co., Ltd. Nomura Asset Management. Oakham Wealth Management, OP Asset Management, OP Real Estate Asset Management Ltd, Orchard Street Investment Management, Pictet Group, PineBridge Investments, Polymer Capital Management, Quoniam Asset Management, Rathbone Brothers, Rockefeller Asset Management, Rothschild & Co Asset Management Europe, Salm-Salm & Partner GmbH, Savills Investment Management, SKY Harbor Capital Management, SLGI Asset Management Inc., Sprucegrove Investment Management, Stance Capital LLC, Stonepeak, Taaleri Plc, Union Asset Management Holding AG, Vancity Investment Management Ltd. (VCIM) and Veritas Asset Management.

Media contacts

For more information or further comment contact:

About the Net Zero Asset Managers initiative

The Net Zero Asset Managers initiative is an international group of asset managers committed to supporting the goal of net zero greenhouse gas emissions by 2050 or sooner, in line with global efforts to limit warming to 1.5°C; and to supporting investing aligned with net zero emissions by 2050 or sooner. The Net Zero Asset Managers initiative launched in December 2020 and aims to galvanise the asset management industry to commit to a goal of net zero emissions. The initiative is endorsed by Investor Agenda and governed by six investor networks – also referred to as the ‘Network Partners’. The Steering Committee of the Network Partners’ CEOs is responsible for the coordination and implementation of the initiative, which includes ensuring that relevant support is provided to signatories to enable best practice implementation of the commitment. The initiative is open to any asset manager globally that is also a member of one of the Network Partner networks. For more information on the initiative please contact us.