The Asian Infrastructure Investment Bank (AIIB) and European asset manager Amundi announced today the launch of the new AIIB-Amundi Climate Change Investment Framework. The new framework is a benchmark investment tool that aims to assess climate change risks and opportunities in line with the three objectives of the Paris Agreement at the issuer-level, enabling investors to discover opportunities not yet priced in to the market. The framework has been endorsed by international certifier and green bond market thought leader Climate Bonds Initiative.
Speaking at the Climate Bonds Initiative international conference, AIIB President and Chair of the Board of Directors Jin Liqun, said:
“The global climate challenge is a huge threat to our world and urgent multilateral action is needed to address this crisis and help our members meet their commitments to the Paris Agreement. In launching this Framework today, we and our partners show our commitment to playing an important role in the battle against climate change, by contributing to strengthening market capacity and driving the green agenda in Asia.”
The new tool translates key climate objectives, climate change mitigation, adaptation and low-carbon transition, into fundamental metrics that can be used to measure an issuer’s alignment with these goals. According to Amundi and AIIB, current climate-focused funds face problems of sector bias, or are overly focused on mitigation efforts, while green bond investors may not consider exposure to climate investment risks and opportunities from the viewpoint of an issuer’s entire balance sheet. The framework takes a holistic approach that current private-capital mobilization efforts lack, avoiding these problems.
By measuring performance against the objectives of the Paris Agreement, the framework enables investors to include that are already performing well on all three objectives (A-list issuers), as well as those that are moving in the right direction but are not A-list issuers yet (B-list issuers). This approach is intended to provide investors with exposure to opportunities not yet priced in by the market.
Yves Perrier, CEO of Amundi, said:
“We are proud to launch this Framework with AIIB as we continue to make strides in the field of climate finance. Mobilizing key stakeholders in supporting the Paris Agreement in Asia is in line with Amundi’s commitment to ESG investing and reflects our extensive commitment to the region. This new Framework will further help the investment community address climate change through the mobilization of capital to emerging markets where it is much needed.”
Sean Kidney, CEO, Climate Bonds Initiative, commented:
“Action on climate means action on investment and private sector involvement to create green capital markets. With this Framework, AIIB and Amundi are laying a new foundation for the development and growth of climate finance and transition investment in the region.”