Investors with $ 4 trillion in Assets Aim to Tackle Asian Businesses on Climate Change Targets

US dollar banknotes explode near the Andalusian capital of Seville in this illustrative photo taken on November 16, 2014. REUTERS / Marcelo Del Pozo / File Photo

MELBOURNE, Sept. 29 (Reuters) – A group of six investors with a total of $ 4 trillion in assets under management, including Fidelity International, on Wednesday said they intended to step up engagement with large Asian companies like banks and energy producers to ensure they have a roadmap for meeting climate change targets.

The initial engagement will focus on carbon and coal risk at banks and utilities exposed to coal, the investor group, facilitated by Singapore-based advisor Asia Research & Engagement (ARE), said in a statement.

The move comes as investors become more active in environmental, social and corporate governance (ESG), helping to shape companies’ climate commitments to better manage this risk for their clients. The ESG measures they have taken include supporting activist shareholder resolutions and voting on board members and compensation.

At the annual meeting of shareholders of Royal Dutch Shell (RDSa.L) in May, nearly a third of shareholders supported a resolution tabled by an activist group, but rejected by the board of directors, who want that the company sets short and medium-term goals. to reduce absolute emissions. Read more

The six investors are BMO Global Asset Management EMEA, Fidelity International, Dutch pension fund PGGM, UK-based Local Authority Pension Fund Forum (LAPFF), Aviva Investors and Legal & General Investment Management.

“Over the past year, we have seen encouraging developments in sustainability related business practices and policies, such as a series of net zero announcements,” said Mirza Baig, Global Head of ESG Investments at Aviva Investors, in the press release.

“In reality, there is still a glaring gap between where we are today and what is needed to ensure that the goals of the Paris Agreement (on climate change goals) are met,” he said. -he declares. “There is a huge opportunity for Asian businesses to take the lead in tackling the climate emergency. “

The group has already started engaging with companies such as Chinese power companies Huaneng (600011.SS) and Huadian (600027.SS). Huaneng and Huadian did not immediately respond to requests for comment.

The investor group will encourage companies such as banks to engage in concrete actions such as exiting the financing of the most carbon-intensive fossil fuels and stopping the financing of the expansion of fossil fuels and associated infrastructure.

The measures would also include encouraging Asian power companies to draw up plans to align their activities with the goals of the Paris Agreement.

Reporting by Melanie Burton in the Melbourne and China team; Editing by Kenneth Maxwell

Our Standards: Thomson Reuters Trust Principles.

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