The world’s biggest investor coalition trying to curb corporate emissions said on Thursday that its members must get companies to cut their emissions rather than just talk about it, as it outlined plans to make these investors more accountable.
ClimateAction 100+ (CA100+), which groups more than 700 investment firms managing $68-trillion in assets including the likes of Amundi, BlackRock and State Street Global Advisors, detailed its plans for its “Phase Two” period that will run to 2030.
The group launched in 2017 to help persuade the biggest polluters to align with the goals of the Paris accord. That agreement aims to keep global temperature rises to 1.5 degrees Celsius to avoid the worst effects of climate change.
It has had some success, with 75 per cent of CA100+’s 166 focus companies – the biggest emitters – committing to reach net-zero emissions by 2050, up from 5 per cent when it launched. More than 90 per cent of companies have also improved their climate-related disclosures.
But only 10 per cent of CA100+ companies have fully aligned their investment plans with their own targets or with the Paris agreement.
Environmental groups and some investors worry progress has stalled, with the Ukraine war providing room for energy companies to invest more in fossil fuels and executives generally having an easier ride at shareholder meetings.
“Phase one for us changed the conversation on climate,” Francois Humbert, Chair of CA100+’s Steering Committee and an engagement manager at Generali Investments, told Reuters.
“In phase two the overarching goal is to go from words to action,” he said, promising there would be “more accountability, more transparency, more seniority” for investors.
The group’s plan to improve accountability comes after criticism from some NGOs that it had achieved little and needed greater transparency around investors’ engagement efforts to avoid the risk of greenwashing.
CA100+ will now ask that its lead investors – those leading engagement with individual firms – publish information on engagement schedules and on how and why they vote at shareholder meetings where the vote is “flagged” by CA100+.
These investors can now disclose their identity on CA100+’s website but the group stopped short of requiring this. Investors will also be encouraged to take the lead in engagement with a specific sector or theme.
Climate activist group Follow This, which has filed a serious of shareholder climate resolutions at energy companies, said in a statement it hoped CA100+’s second phase would improve the unity of the group and get more members to back resolutions recommended by lead investors.
CA100+ stresses that it is a voluntary initiative and that it cannot tell investors how to vote or behave.
The group said it has added 14 companies to its list of the biggest emitters including Carrefour, Samsung Electronics and Tata Steel, and removed 10 others.