Recognising the urgent need to tackle climate change, Border to Coast Pensions Partnership, one of the largest UK pension pools, today confirms its commitment to achieving net-zero greenhouse gas emissions across its investments by 2050 or sooner.
Chris Hitchen, Chairman of Border to Coast, said: “Climate change is an existential threat to societies across the world – doing nothing is not an option. Representing asset owners with over £55bn of assets, we have a key role in not just managing the impact of climate change on our portfolios, but also in supporting the investment needed to transition to a low carbon future.”
Announced as part of its first standalone Climate Change Policy, Border to Coast will use the Net Zero Investment Framework to set out a roadmap over the next 12 months defining how it will support this commitment. This will include:
Setting interim targets for 2030, supporting efforts to achieve up to a 50% global reduction in CO2 emissions identified as a requirement in the IPCC special report on global warming;
Prioritising engaging with policymakers, regulators and companies to work to achieve real economy emissions reductions within the sectors and companies in which it invests;
Creating and evolving investment propositions aligned with net zero emissions by 2050, and facilitating increased investment in climate transition solutions;
Working with the industry to improve carbon data disclosure and transparency in fixed income and private markets, where information is currently unreliable; and
Implementing a revised stewardship and engagement strategy with a clear escalation and voting policy that is consistent with being Net Zero across its investments by 2050 or sooner.
Rachel Elwell, CEO at Border to Coast, said, “Given the scale of the issue, collective action is required. Together with our Partner Funds, we will work with like-minded investors to drive positive change in the companies we invest in, engage with policymakers and regulators to highlight where systemic solutions are required, and seek to understand how developed economies can support developing and emerging markets in this essential journey.”
Border to Coast’s first formal Climate Change Policy details its approach to fulfilling its commitment to managing the risks and opportunities associated with climate change. Once adopted, it confirms Border to Coast will:
Exclude ‘pure’ coal and tar sand companies from its investments – at this level of revenues, there is little scope for successful engagement, where companies either cannot or will not change their strategy;
Vote against company Chairs in high emitting sectors where the climate change policy does not meet its minimum standards;
Support climate-related resolutions at company meetings which reflect its Climate Change Policy;
Engage with companies in relation to business sustainability and disclosure of climate risk in line with the TCFD recommendations;
Encourage companies to publish targets and report on steps taken to reduce greenhouse gas emissions;
Work collaboratively with other asset owners to strengthen its voice and make a more lasting impact for positive change;
Engage collaboratively alongside other institutional investors with policy makers through membership of the Institutional Investor Group on Climate Change (‘IIGCC’).
In addition to developing a roadmap on how it will implement its Net Zero commitment, over the next year Border to Coast will work with its eleven Partner Funds on managing their climate change investment risks and reporting requirements. As part of this, Border to Coast intends to become a signatory to the Net Zero Asset Managers initiative later this year.
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