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Serving asset owner clients [is only possible] through climate stewardship | NZAOA

INSIGHT by the Net-Zero Asset Owner Alliance (NZAOA)

Published investESG on 2024-02-06
© Ansgar Scheffold
The UN-convened Net-Zero Asset Owner Alliance launched a call to action, sending a clear message to the asset management industry that “Serving Asset Owner Clients [is only possible] through Climate Stewardship“.
The call to action references the Alliance’s tools and guides on asset management engagement (Proxy Voting, Policy Engagement, Engagement Best Practices, and Private Markets) to assert that asset owners committed to net-zero, such as members of the Alliance, expect their asset managers in private and public markets to pursue integrated and tailored climate strategies across all their functions.
What does comprehensive and systematic integration of climate change risks and opportunities into asset manager activities look like?
This call to action draws out four critical implementation principles for asset manager leadership:
  • Bring the focus of addressing the systemic risk of climate change to the entirety of investments and operations;
  • Support a consistent, clear, and accountable proxy voting landscape (for public equity);
  • Align lobbying activities with asset manager’s own stated climate-related commitments do the same for portfolio companies; and
  • Ensure that climate engagement is more systematic and transparent (especially on its own limitations).
For the approach to be systematic in nature, the Alliance underlines that asset managers must individually implement all four of the above-mentioned principles and their underlying activities (as detailed in the associated Alliance guidelines).
Implementing these not only protects the long-term financial interests of both the asset managers and their asset owner clients, but it would also increase the ability of asset managers to win mandates from asset owners committed to net zero, which are growing in numbers.
To ensure these messages reach the asset managers of Alliance members and the broader asset management industry, this call to action will also be used as a basis for both individual member bilateral engagements and for a public webinar with the asset manager community, which will be held in March.
about
The UN-Convened Net-Zero Asset Owner Alliance (the Alliance) is a member-led initiative of 88 institutional investors, with US$9.5 trillion in assets under management, committed to transitioning their investment portfolios to net-zero GHG emissions by 2050. The Alliance members were the first in the financial industry to set intermediate targets (aligned with the Paris Agreement schedule) and they report on their progress annually. The Alliance is convened by UNEP FI and PRI, and is supported by WWF and Global Optimism.
All opinions expressed are those of the author and/or quoted sources. investESG.eu is an independent and neutral platform dedicated to generating debate around ESG investing topics.
investESG