Net Zero Asset Owner Alliance surges to almost $4tn

Four more investors have joined the UN-convened network

Festival Net Zero 2021

Pension funds and insurers with almost $4 trillion (£3tn) of assets under management are targeting carbon neutrality by 2050 under the Net Zero Asset Owner Alliance.

It comes as four more large investors – AXA, Aviva, CNP Assurances and Fonds de Réserve pour les Retraites (FRR) -joined the UN-convened network at the COP25 UN climate change conference in Madrid.

The Alliance is a group of the world’s largest pension funds and insurers that have committed to fully decarbonise their portfolios to avoid a global temperature increase above the 1.5°C Paris target.

It was initiated in September this year by Allianz, Caisse des Dépôts (CDC), La Caisse de dépôt et placement du Québec (CDPQ), Folksam Group, PensionDanmark and Swiss Re, which were joined by Alecta, AMF, CalPERS, Nordea Life and Pension, Storebrand and Zurich as founding members.

By joining the Alliance, members hold themselves accountable on progress by setting and publicly reporting on intermediate targets in line with the Paris Agreement.

They will engage with governments and ask them to urgently increase their National Determined Contributions, following the UN Environment Programme’s (UNEP) latest report suggesting G20 nations collectively account for 78% of all emissions but only five members have committed to long term zero emissions targets.

UNEP Executive Director Inger Andersen said: “Clearly, business is leaning in because you understand this is imperative – not only to do good but to do right and to be profitable in the long run. We are working together with these institutional investors to help them shift corporate behaviour to align with the Paris Agreement.

“If we can get the top 100 asset owners who represent US$ $55 trillion (£41tn) in assets under management to make that shift, we can play a fundamental role in combatting the climate crisis.”

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