Pictet is an investment-led service company, offering wealth management, asset management and related services. Pictet is a partnership of eight owner managers. Pictet joined the Net Zero Asset Managers Initiative in November 2021 and made their Initial Target Disclosure in November 2022.
Percentage of assets covered by the Net Zero Asset Managers Commitment Statement
56% of total AUM (USD $277.3 billion)
Information on interim target(s) covering the proportion of assets to be managed in line with net zero
0.17 tCO2e per square meter in 2021
20% of AUM in portfolio companies setting a Science Based Target
-67% reduction in GHG emissions per square meter by 2030.
Pictet commits that 40% of its listed equity and corporate fixed income (single lines) by invested value will have set validated 1.5°C science-based targets by 2025. Pictet commits that 60% of its listed equity and corporate fixed income (single lines and third-party funds) portfolio by invested value will have set validated 1.5°C science-based targets by 2030, and 100% by 2040.
GHG scopes included:
Our investment targets described above cover scope 1 and 2 emissions for our Sectoral Decarbonisation Approach (SDA) real estate approach. Whilst the portfolio coverage target is stated in terms of AUM, we expect companies with material scope 3 emissions (as defined by the SBTi) to set targets on those, on top of their scope 1 and 2.
Science Based Target initiative for Financial Institutions
For the SDA, we used the SBTi real estate target setting tool, aligned with 1.5°C. Based on the International Energy Agency (2021) Net Zero by 2050: Net Zero by 2050 Scenario – Data product – IEA, as modified by the SBTi
Proportion of AUM committed:
Pictet followed the Science Based Targets initiative (SBTI)’s guidance to determine the scope of our targets, which have been validated. We include 100% of direct and indirect listed equity and corporate fixed income investments across our asset management (active and passive) and wealth management (discretionary mandates) divisions. This represents the majority of our holdings. We include 100% of real estate direct investments and co-investments. No target on real estate third-party fund selection (accounts for < 1% of AUM) because lack of data to estimate emissions. We plan to set targets on 100% of AUM over time as methodologies and data improves. We currently await SBTi guidance on sovereign fixed income and advisory services (wealth management), which represent 20% of AUM.
Policy on coal and other fossil fuel investments:
At Pictet, we emphasise engagement over exclusion, as supported by our Climate Investment Principles and the latest external research on the value of engagement vs. divestment see E4S. This is why we put the emphasis on engaging with fossil fuel companies to set 1.5°C-aligned science-based targets and create associated action plans. Nonetheless, we recognise that exclusions have a role to play where a sector or an issuer is unable or unwilling to transition. At firm-level (applicable to 100% of AUM), we exclude thermal coal mining (>25% revenue exposure). In our Responsible Investment strategies (>50% of AUM in Article 8 or 9), we also apply exclusions for coal-fired power generation, unconventional oil & gas extraction, and oil & gas production. More detail available here (for PAM) and here (for PWM).
Additional analysis is underway to determine how best to strengthen our approach to fossil fuels (expected publication in 2023).