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Asset managers call on companies to cut down on carbon emissions

carbon_emissions_investmentHigh carbon emitting companies have been called on by investment management firms to commit to a net zero future by setting science-based targets.

Over 1,800 companies responsible for 25% of global emissions – including Tesla and mining giant Rio Tinto – have been singled out and asked to set a 1.5°C carbon reduction target to achieve this goal.

Coordinated by non-profit sustainability action group CDP, the financial institutions calling for action include Amundi, Legal & General Investment Management, and Nikko Asset Management. Together, the group represents $20 trillion (€17 trillion) of assets. 

The carbon emitting companies in question represent 40% of MSCI’s flagship global equity index. Previous research by CDP has suggested that companies see $1 trillion at risk from climate change, putting investments in jeopardy.

Emily Kreps, global director of capital markets at CDP, said: “Climate change presents material risks to investments, and companies that are failing to set targets grounded in science risk losing out – and causing greater damage to the world economy.”

Amundi’s director of the institutional and corporate clients division and ESG, Jean-Jacques Barberis, added: “Limiting global warming requires collective response; corporate actions and investors’ mobilisation to decarbonise portfolios go hand-in-hand.”

While companies can set science-based targets at any point throughout the year, investors will be engaging with companies until May 2021, when the impact of this campaign will be evaluated.

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