Investors worth €3.6trn collaborate to promote just transition to net-zero

AXA, Aviva France and Eiffel are among the members of a new coalition of investors convened to promote a just low-carbon transition across Europe. Collectively, members represent Є3.6trn of assets under management.

The new coalition is being convened by Finance for Tomorrow, an initiative originally launched in 2016 to help the French finance sector align with the ambitions of the Paris Agreement. It is called ‘Investors for a Just Transition’.

Founding members are Amundi, Aviva France, AXA & AXA Investment Managers, Caisse des Dépôts, CNP Assurances, CPR Asset Management, Eiffel, ERAFP, La Banque Postale Asset Management, ODDO BHF Asset Management, Rothschild & Co Asset Management Europe and SCOR Investment Partners.

As a starting point, coalition members will, alongside observers including the UN Principles for Responsible Investment (PRI), work to develop specific engagement objectives for supporting the key industries in which they invest. These objectives will be drawn up following consultation with companies, trade unions, universities and research institutes.

The objectives will enable investors to engage with the high-carbon companies in their portfolios with a unified voice. They will also assist with the creation of a digital ‘Just Transition Hub’, whereby investors will be able to assess the work companies are doing to accelerate the low-carbon transition while supporting staff, suppliers and communities.

Aside from this work, coalition members will support the publication of research papers on the just transition through partnerships with leading universities and/or research institutes.

Finance for Tomorrow’s vice-president Jean-Jacques Barberis said: “The decision to create the first investor coalition for a just transition stems from several observations. First of all, the just transition is a necessary condition for implementing the Paris Agreement. Our climate objectives can and will only be reached if we ensure that every one of society’s stakeholders is included in the process. Then, the financial sector has a role to play here by fully integrating the social dimension in their financing policies.”

Investors for a Just Transition is currently working exclusively in France. At COP26, an international launch will take place and investors from other nations will be encouraged to confirm their support.

Climate Equity Fund

In related news, General Motors (GM) has launched a new $25m ‘Climate Equity Fund’, dedicated to supporting workers, suppliers and communities through the transition to electric vehicles (EVs) and other zero-emissions technologies for road transport. 

GM’s plans for allocating the funding cover four pillars: the future of work; EV access; infrastructure equity and climate equity. Under EV access and infrastructure equity, part of the funding could be used to lower the upfront cost of EVs and chargets for consumers, but the company is ultimately supporting a national subsidy scheme.

Speaking during the Aspen Ideas Festival about the Fund launch, GM’s chief executive Mary Barra said: “Climate change does not impact every community equally…As we move to an all-electric, zero-emissions future, it is on us to lead positive change and implement inclusive solutions that bring everyone along, especially our employees and communities.”

The announcement comes shortly after the US-based automaker announced a 75% increase in investment in EVs and automated vehicles through to 2025, bringing the figure to $35bn.

Join the conversation at edie’s Sustainable Investment conference 

edie’s Sustainable Investment Conference is returning in a virtual format for the second consecutive year on 13-14 July, with hundreds of professionals already registered to attend. 

The conference will unite sustainability professionals from businesses and financial experts from investors to discuss the array of challenges and opportunities that embracing the green recovery can bring. Experts from the likes of BlackRock, UKSIF, UBS Asset Management, CDP and WWF feature on the event’s high-level speaker list. 

Click here for a full agenda and to register for tickets. 

Sarah George