Fund managers select consultants to create “missing piece” of climate finance puzzle

A group of asset managers attempting to establish a standardised method for calculating avoided emissions in commercial environmental projects such as electric car manufacturing has selected two sustainable investment consultancies to implement a process.

Mirova and Robeco, which are founding partners of the initiative along with firms including Edmond de Rothschild, have selected two consultancies, I Care by Bearing Point and Quantis, to develop a global standard for calculating emissions avoided by low-carbon solutions.

For the financial sector, the initiative will generate estimates of the emissions avoided by activities that firms invest in, making them transparent and comparable.

Lucian Peppelenbos, climate and biodiversity strategist at Robeco, said: “Avoided emissions are the missing piece of the puzzle when it comes to facilitating transition finance. At a global level, much more capital needs to go into climate solutions. This metric can help to direct capital flows towards companies that provide the most effective climate solutions.”

The database built by I Care by Bearing Point and Quantis will initially cover 80 specifically defined low-carbon solutions, such as biomass energy, recycled plastic and low-carbon concrete.

As an example, the group said if it is relevant to take into account all the resources and the recyclability of components that come into play in the production of an electric vehicle, it is also relevant to understand and measure the carbon emissions that can be avoided by an electric vehicle in a transport sector still very dependent on thermal engines.

Development of the database will commence in January 2024.

Guillaume Abel, deputy CEO of Mirova, said the initiative is a “major step forward in the history of Mirova” and added: “This innovation will allow investors to better identify and value companies that contribute positively to the decarbonisation of the economy and are therefore well positioned to create value in a world in transition. It will also facilitate the aggregation of the carbon footprint of delegated assets for our institutional clients.”

The initiative is supported by ten founding partners, representing more than US$ 2 trillion of assets under management and includes Natixis Investment Managers, Man Group and Comgest.

© 2024 funds europe



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