A significant minority of asset owners (34%) have said that using established frameworks to invest in the energy transition prevents their investments from making a real-world impact, according to asset manager Ninety One’s annual ‘Planetary Pulse’ report, surveying 300 asset owners and consultants. The report explores asset owners’ investment approaches to the risks and opportunities presented by climate change. It found that almost half of asset owners (48%) have between a quarter to half of their AUM invested in portfolios with climate-related instructions or objectives, up from 40% in 2022. But while some asset owners use proprietary or consultant-developed frameworks to make these investments, 43% said there was too much discretion permitted in the selection of climate-related targets, and 44% said the same about the metrics that underpin them. The report also noted that a majority of asset owners (57%) believe that using an established climate-related target-setting framework has a real impact on emissions levels. Nazmeera Moola, Chief Sustainability Officer at Ninety One, said: “Our research shows there is a disconnect between decarbonisation intentions and outcomes, and that investors need to be able to capture the full picture of their portfolio’s emissions to measure climate impact. Now, more than ever, we need to bridge the gap, collaborate and act as a driving force to meet the 2050 climate goals.”
