Global asset management firm AXA Investment Managers (AXA IM) announced that it has aligned approximately two thirds of its nearly €900 billion of assets under management with a 2050 net zero objective, as of the end of 2021.
The announcement was made as part of AXA IM’s report to the Net Zero Asset Managers Initiative. AXA IM is one of the 30 founding members of the initiative, launched in December 2020, committing to support the goal of net zero greenhouse gas emissions by 2050 or sooner, in line with global efforts to limit warming to 1.5°C. Since launch, the initiative has grown rapidly to include more than 230 signatories, representing nearly $60 trillion in assets under management. The coalition part of the Glasgow Financial Alliance for Net Zero (GFANZ).
In the report, AXA revealed that €580 billion of AUM, or 65% of total AUM, encompassing its investments in corporate equity and bonds, government bonds, listed real assets, and real estate assets managed on behalf of AXA Group, are managed to be in line with net zero. Net zero pathways have been defined for all of these assets, in line with the Intergovernmental Panel on Climate Change (IPCC) 1.5°C pathways report,
Signatories to the Net Zero Asset Managers Initiative also agree to a broad range of commitments, including setting interim targets for the proportion of assets to be managed in line with 2050 net zero, and to align stewardship, engagement, voting policy and advocacy policy with net zero goals.
AXA IM stated that it has committed to have its full corporate assets portfolio net zero or aligning by 2040, and earlier this month, the firm announced a new “three strikes and you’re out” policy for climate laggards, under which the firm will actively engage over three years with companies from a focus list of those considered material from a portfolio and climate perspective, after which time AXA IM will divest if specific objectives are not reached.
Marco Morelli, Executive Chairman at AXA IM, said:
“Going forward, our aim is to continue to grow the proportion of Net Zero aligned AUM as reliable methodologies become available for all asset classes. As part of our Net Zero commitment we will continue to engage with a number of companies which are not yet on a Net Zero aligned trajectory. We will also continue to invest in companies providing climate solutions, innovation being essential to enable the transition.”