Nuveen, the investment manager of TIAA, announced that it is joining climate-focused investor initiative Climate Action 100+, adding another trillion-dollar manager to the organization’s ranks. The company also announced that it is partnering with leaders in climate change research on a new program focusing on how and where climate change may impact investment portfolios, with the goal of improving long-term investment outcomes for the firm’s clients.

Jose Minaya, CEO of Nuveen, said:

“These initiatives are just the latest evidence of our ongoing commitment to helping investors manage climate change’s impacts, both emerging and long-term, a commitment we are fulfilling every day through our firm’s Responsible Investing platform.”

Climate Action 100+ is an investor initiative, with over 500 investors representing more than $47 trillion in assets, that targets the world’s largest corporate greenhouse gas emitters to promote taking necessary action on climate change. Last week, the organization announced that it was sending  a letter to the CEOs and Chairs of the Board of 161 companies, representing up to 80% of global industrial greenhouse gas emissions, calling on the businesses to put in place net-zero business strategies and define targets to support delivery, and informing the CEOs that the companies will be assessed on progress made in becoming net-zero businesses.

For the new climate change program, Nuveen announced that it will work with the UN-supported Principles for Responsible Investment’s Inevitable Policy Response initiative, as well as with several leading climate research organizations helping to provide the firm with next generation data on physical climate hazards and their socioeconomic impact.

The program will focus on both the physical and the transition risks associated with climate change. Nuveen is working with numerous specialized climate research organizations to model the physical impacts of climate change on investment portfolios across municipal bonds, real estate and real assets, translating physical climate hazards into actionable insights. PRI’s Inevitable Policy Response helps investors navigate climate change’s evolving policy and regulatory landscape in order to enhance portfolio resilience and inform strategic asset allocation.

Amy O’Brien, Global Head of Responsible Investing at Nuveen,  said:

“Long-term investment performance depends, among other factors, on natural systems that provide clean water, abundant food, and many other global resources – systems that are threatened by worldwide climate change.

“The wildfires now raging through the western United States are only the latest, dramatic example of extreme events rooted in climate change that can both devastate communities and pose systemic risk across a broad spectrum of assets. More and more, climate change will have a meaningful influence on economic growth; portfolios also are likely to be affected by the emerging public policy responses to climate change, focused on supporting the transition to a low-carbon economy. Understanding climate change risk in all of its forms is essential to mitigating its impact.”

Fiona Reynolds, CEO of PRI, said:

“We believe that, by 2025, we will see a policy response to climate change with the potential to be forceful, abrupt, and disorderly – creating major winners and losers within investment portfolios. We’re looking forward to working with Nuveen’s investment professionals to help them understand how this response will likely unfold, the impact on the economy and what steps to take to successfully manage the risks.”

Minaya added:

“While Nuveen will continue to offer a diverse range of investment strategies that allow clients to align their investments to renewable and energy efficient projects, this initiative underscores our belief that climate risk is relevant to all of our clients’ investments to build portfolio with purpose while improving returns over the long term.”