Our Responsible Investment overlays
26
Climate change is one of the single largest threats to the global economy and in general to the conditions of all life on earth. In addition, it implies specific risks to the companies and other entities we invest in. NAM is working on an ongoing basis to assess climate change risks and the impact of the low-carbon transition on sectors and companies. Climate change presents a challenge to our investments – in terms of its physical impact as well as through the prospect of radical policy measures and changing consumer behaviour with the aim of reducing GHG emissions globally.
Collaborative engagement initiative: Climate Action 100+
We participate in multiple international investor initia- tives and collaborative engagements around climate topics. One such example is our participation in CA100+ collaborative engagements with the world’s most carbon- intensive public companies. We feel encouraged by some positive developments we have seen related to CA100+: • 52% of the companies have set a clear ambition to reach net-zero GHG emissions by 2050 • 87% of the companies have board-level oversight of climate change • 72% of companies have disclosure aligned with TCFD recommendations.
We expect companies exposed to climate risk to:
• have a strong climate governance and demonstrate how they integrate climate change challenges into their business strategies, investment decisions and risk management • be able to disclose how their long-term business strategy and profitability will be impacted by a different regulatory and physical environment • show how they identify and capitalise on opportunities related to climate change • be transparent in regards to their position on climate change regulation and interaction with regulators and policy makers • report in line with TCFD recommendations and act to reduce greenhouse gas (GHG) emissions across their value chains in accordance with the Paris Agreement
Example of climate engagement escalation
We firmly believe that corporate lobbying and public affairs efforts should refrain from providing direct or indirect support to regulatory initiatives that risk slowing down the energy transition. This is a topic we have been trying to engage on with Exxon Mobil. Due to the slow progress towards meeting our engage- ment expectations, we decided to escalate engagement by co-filing a shareholder resolution demanding reporting on climate lobbying aligned with Paris Agreement. We were happy to see that the resolution received the major- ity support in Exxon Mobil’s meeting in May 2021.
Made with FlippingBook flipbook maker