65% of AXA IM’s total assets are managed to be in line with Net Zero
As a member of the Net Zero Asset Managers Initiative1 (NZAMI), AXA Investment Managers (AXA IM) has committed to support the goal of net zero greenhouse gas (GHG) emissions by 2050, in line with global efforts to limit warming to 1.5°C (“net zero emissions by 2050 or sooner”).
In its second report to the NZAMI, AXA IM has shared the following:
- 65% of its total assets under management (AUM) are managed to be in line with Net Zero, representing c.€580 billion as of the end of 2021.
This scope now includes 100% of corporate equity and bonds, government bonds, listed real assets, and the real estate assets managed on behalf of AXA Group. For all of these assets, clear Net Zero pathways have now been defined in line with the Intergovernmental Panel on Climate Change (IPCC) 1.5°C pathways report.
- Interim carbon intensity2 reduction targets applicable to corporate assets3 have been set with a view to achieve -25% for 2025 and -50% for 2030 vs 2019. These targets will be monitored through various agreed methodologies (Net-Zero Asset Owner Alliance & Net Zero Investment Framework developed by the Paris Aligned Investment Initiative coordinated by the Institutional Investors Group on Climate Change, notably) and reported on.
- AXA IM commits to have its full corporate assets portfolio Net Zero or aligning by 2040. Any holdings that would miss this target will be divested from in 2040.
- Reaffirmed intention to grow the proportion of Net Zero aligned AUM over time.
Marco Morelli, Executive Chairman at AXA IM, said:
“We are proud to announce key updates to our climate commitments to play our part in the transition to a low-carbon world. Targets have been set for the majority of assets where Net Zero methodologies are available for the time being, and where we have the ability to set such targets from a legal perspective. Going forward, our aim is to continue to grow the proportion of Net Zero aligned AUM as reliable methodologies become available for all asset classes. As part of our Net Zero commitment we will continue to engage with a number of companies which are not yet on a Net Zero aligned trajectory. We will also continue to invest in companies providing climate solutions, innovation being essential to enable the transition. ”
AXA IM has also taken the following actions to contribute to the transition to a low carbon world:
- Exit all coal investments in OECD countries by 2030, and throughout the rest of the world by 2040.4
- Introduction of strengthened voting policy5 and ‘three strikes and you’re out’ approach to climate laggards in 20226 , supplementing the extended oil and gas policy and tougher biodiversity engagement programme introduced in 2021.
- Engagement with 245 entities in 20217 , with 33% of those engagements related to climate change and 14% related to resources and ecosystems. Climate, biodiversity and social issues will also remain key priorities for engagement with companies in 2022.
- Continued investments in green assets (impact bonds, green listed equity and green real assets). These assets represent c. €38 billion. Making its product range greener, including the launch of new carbon-focused strategies, further expanding a portfolio of green investments and expanding the AXA IM Core “ACT”8 range of funds.
- Publication of a yearly TCFD report9 since 2019, presenting the ESG and climate strategies, as well as key metrics, such as the carbon footprint of investments which decreased by -15.5% between 2019 and 2021. Details of our Net Zero commitment as well as regular follow-up on progress will be available in the annual report to be released in June 2022.
- Targeting at least 50% of direct real estate AUM aligned with 1.5° trajectory by 2025 using CRREM (Carbon Risk Real Estate Monitor) target pathways.
More details about AXA IM’s commitments as a responsible investor and business can be found here.
- This measurement includes Scope 1 (direct) and 2 emissions (indirect, linked to energy).
- Corporate assets are corporate bonds and equities.
- See the climate risks policy : https://www.axa-im.com/sites/corporate/files/2021-08/20210226_AXA_IM_Climate_Risks_Policy_.pdf
- See: https://www.axa-im.com/axa-im-unveils-new-voting-policy-urge-investee-companies-further-consider-environmental-and-social
- See: https://www.axa-im.com/axa-im-further-strengthens-its-climate-actions-accelerate-its-contribution-low-carbon-world
- See: https://www.axa-im.com/who-we-are/stewardship-and-engagement
- The ACT range: these assets invest with a purpose to support the transition to a more sustainable economy. Funds have been assigned thematics aligned to ESG and/or UN’s Sustainable Development Goals (SDGs) objectives. Active stewardship is a key focus for this range, with voting and engagement reporting available at fund level. This range encompasses sustainable and listed impact funds.
- See TCFD reports here : axa-im.com/our-policies
About the Net Zero Asset Managers Initiative:
The Net Zero Asset Managers initiative brings together an international group of asset managers committed to supporting the goal of net zero greenhouse gas emissions by 2050 or sooner, in line with global efforts to limit warming to 1.5 degrees Celsius; and to supporting investing aligned with net zero emissions by 2050 or sooner.
It currently includes 236 signatories managing $57.5 trillion of assets under management.