Weekly ESG News: Financial Services and Insurance Industry (16/2024)
News in the spotlight: Climeworks extends carbon removal offering for portfolios
Climeworks has expanded its carbon removal offerings beyond direct air capture, now providing tailored portfolios comprising both engineered and nature-based approaches to remove CO₂ from the atmosphere.
Products and Services
Bezos Earth Fund announced $100mn investment to tackle climate change and nature loss
The Bezos Earth Fund announced a $100 million AI for Climate and Nature Grand Challenge, seeking innovative AI solutions to combat climate change and nature loss. The initiative aims to foster collaboration between environmental groups and AI technology providers, focusing on sustainable proteins, biodiversity conservation, and power grid optimization. Proposals will be solicited from universities, NGOs, companies, and global organizations, with selected projects receiving seed grants and mentorship to develop viable solutions.
LGIM launches Energy Transition Commodities ETF
LGIM introduces the L&G Energy Transition Commodities UCITS ETF, offering exposure to key commodities crucial for the energy transition. The ETF encompasses transition metals, lower-carbon energy sources, and carbon pricing, providing diversification and hedging with over 50% of uncommon constituents. LGIM’s expansion reflects growing demand for low-correlation investment solutions, allowing investors to seize growth opportunities while mitigating inflation risks. Managed by LGIM’s experienced team, the Fund is available to investors in Europe and Singapore, categorized under Article 6 of the Sustainable Finance Disclosure Regulation.
Robeco positions Asian Bonds fund for transition investing
Robeco is transforming its Asian Bond fund into a transition investing-ready vehicle, aiming to allocate capital towards companies driving sustainable change across sectors. By integrating forward-looking metrics, they distinguish transition leaders from laggards, expanding transition investing into public markets, particularly in Asia and emerging markets. Their approach emphasizes intentionality, measurability, and credibility, leveraging 25 years of sustainability expertise to create diversified portfolios with real-world impact.
Wellington Management announced US$385mn close for Climate Innovation I fund
Wellington Management has closed the Wellington Climate Innovation Fund at US$385 million, focusing on investing in private companies tackling climate change. The fund aims to generate returns by supporting late-venture and early-growth companies developing tech solutions in energy transition, sustainable buildings, transportation, and more. Led by Greg Wasserman, the fund draws on Wellington’s extensive resources and network. The team includes Molly Breiner, Mike DeLucia, and Sean Petersen, leveraging Wellington’s $8.5 billion private investing platform and collaboration with the Woodwell Climate Research Center. This announcement follows Wellington’s recent successful closures of other venture funds.
Regulations, Law & Frameworks
China finalized mandatory Sustainability Reporting Standards
On April 12, 2024, the Shanghai, Shenzhen, and Beijing Stock Exchanges issued Sustainability Report guidelines effective May 1, 2024, aiming to integrate sustainable development into companies’ strategies. Using a double materiality approach, the guidelines require companies to assess topics’ impact on their business and the economy, society, and environment. Emphasizing environmental concerns, social responsibilities, and governance, the guidelines align with international standards, easing the burden of sustainability disclosure preparation for companies under various regimes.
NZAOA published fourth edition of the Target-Setting Protocol
The Net-Zero Asset Owner Alliance released its fourth edition of the Target-Setting Protocol, emphasizing a 1.5°C ambition for 2030 portfolios. The protocol, supported by major institutional investors managing $9.5 trillion, aims to halve emissions by 2030 and achieve net-zero emissions by 2050. It covers a wide range of asset classes, including private assets, and encourages members to set ambitious 2030 targets in line with the Paris Agreement. Additionally, the Alliance is piloting the assessment of sovereign debt holdings to better understand their climate alignment and risks.
Leadership Announcements
Scottish Widows appoints new Head of Responsible Investment and Stewardship
Eva Cairns recently joined Scottish Widows as the new Head of Responsible Investment and Stewardship, bringing with her 18 years of experience in responsible investing and climate strategy. Formerly at abrdn, she led sustainability research and climate strategy, advocating for industry-wide best practices. With a background in economics and a focus on environmental impact assessment, Eva aims to strengthen Scottish Widows’ commitment to responsible investing. Scottish Widows has already surpassed its targets, having invested over £1.3bn in climate solutions, and looks forward to leveraging Eva’s expertise to further advance its ESG initiatives.
ESG Data & Analytics
Climeworks extends carbon removal offering for portfolios
Climeworks has expanded its carbon removal offerings beyond direct air capture, now providing tailored portfolios comprising both engineered and nature-based approaches to remove CO₂ from the atmosphere. The move responds to strong customer demand and the urgent need to accelerate climate action. Swiss luxury watchmaker Breitling is the first to benefit, closing a groundbreaking 12-year agreement to enhance its net-zero roadmap. Climeworks ensures the highest quality by vetting all suppliers, guaranteeing that every ton of CO₂ purchased is indeed removed. With nearly 30 clients already in negotiations, Climeworks Solutions meets the growing demand for comprehensive carbon removal strategies, exemplified by Breitling’s commitment to combating climate change.