Net Zero Interim Targets
We have set interim targets for emissions reductions that apply to a portion (approximately 14% as of 12/31/21) of our assets under management (our “Net Zero Target Assets”)1. While we believe attention to climate risk is relevant to long-term value, our targets will only be achieved if net zero is important to our clients and they instruct us to achieve that objective in the portfolios that we manage for them. In this regard, it should be noted that we will not depart from client mandates to achieve the objective of net zero, we will not force any client to embrace net zero, and we will not sell companies in any index because those companies do not achieve net zero targets or objectives. As an index manager, we are long-term shareholders on behalf of our clients and we are focused on delivering the index exposure to those clients.
We have set the following three targets that apply only to our Net Zero Target Assets :
- By 2040, we expect all of our client assets in our Net Zero Target Assets (14% of our total portfolio assets as of 12/31/21) invested in carbon-intensive industries2 to be (i) achieving net zero3 or (ii) aligned to net zero4, and we will work with those clients to help them develop net zero guidelines and implement them into their portfolios.
- By 2030, we expect 90% of financed emissions5 in carbon-intensive industries in the client portfolios in our Net Zero Target Assets (14% of our total portfolio as of 12/31/21) to be coming from companies: (i) achieving net zero, (ii) aligned to net zero or (iii) subject to engagement and stewardship actions.
- By 2030, we expect financed Scope 1+2 carbon emissions intensity6 in each client portfolio in our Net Zero Target Assets (14% of our total portfolio assets as of 12/31/21) to be reduced by 50% relative to a 2019 baseline.