What Is the Net Zero Asset Managers Initiative?
The Net Zero Asset Managers Initiative is a group of global asset managers that are committed to working toward the goal of net zero greenhouse gas emissions by no later than 2050. As part of their commitment to the initiative, asset manager participants agree to support investing aligned with net zero emissions by 2050 or sooner. The initiative was founded in December 2020.
The founding partners of the Net Zero Asset Managers Initiative include Asia Investor Group on Climate Change (AIGCC), CDP, Ceres, Investor Group on Climate Change (IGCC), Institutional Investors Group on Climate Change (IIGCC), and Principles for Responsible Investment (PRI).
- The Net Zero Asset Managers Initiative is a group of international asset managers committed to working toward net zero greenhouse gas emissions by 2050.
- Launched in December 2020, the initiative has 235 signatories managing $57.5 trillion of assets.
- Signatories commit to engaging with clients and companies, advocating for policy change, and shepherding investments to support the goals of the initiative.
Understanding the Net Zero Asset Managers Initiative
The Net Zero Asset Managers Initiative has grown quickly since its founding. As of March 31, 2022, the project has 235 signatories managing more than $57.5 trillion of assets. The initiative was launched in acknowledgment of an urgent need to move toward global net zero emissions to minimize the negative impact of climate change.
Signatories to the initiative may engage in the work of the project to accelerate work toward net zero emissions by:
- Engaging with clients
- Setting new targets for managed assets
- Engaging with corporations
- Advocating for policy changes
The project acknowledges that many asset managers had previously worked toward similar goals before the launching of the initiative. What sets the Net Zero Asset Managers Initiative apart is its scale, the obligation of signatories to report on actions taken, and continual updating of targets and goals.
The initiative does not specify that asset manager participants must divest from high-carbon companies. Rather, it states as a goal that signatories will manage “an increasing proportion of...assets in line with net-zero goals,” leaving the possibility that participants may leverage high-carbon companies to seek net zero practices.
Signatories of the Initiative
Signatories of the initiative as of March 31, 2022, include Baillie Gifford, BlackRock, Columbia Threadneedle Investments, Fidelity International, HSBC Asset Management, Invesco, Nomura Asset Management, Santander Asset Management, State Street Global Advisors, and many others.
How do the Net Zero Asset Managers Initiative signatories achieve their goals?
Signatories to the Net Zero Asset Managers Initiative leverage their status in the global financial system to engage with clients and corporations, advocate for new policy, and ensure that their investments are in line with project goals.
Who oversees the initiative?
The initiative is led by founding partners Asia Investor Group on Climate Change (AIGCC), CDP, Ceres, Investor Group on Climate Change (IGCC), Institutional Investors Group on Climate Change (IIGCC), and Principles for Responsible Investment (PRI).
What does net zero mean?
The term “net zero” means finding a balance between carbon removed from the atmosphere and the carbon emitted. Carbon dioxide is emitted when fossil fuels are burned to meet energy demands, but that is not the only greenhouse gas emitted. To reach net zero, emissions from homes, farms, vehicles, and industry must be reduced, and technology must be developed to extract greenhouse gases from the atmosphere.