Climate Action 100+, the world’s largest investor engagement initiative on climate change, has launched its next phase to inspire greater corporate climate action in this critical decade.
Building on the demonstrable success of the initiative’s first five years, including an increase from only five Climate Action 100+ focus companies at outset to 75% of them now committing to net zero, the next seven years mark a further evolution that intends to support a global scale up in active ownership.
The new phase shifts focus from corporate climate- related disclosure to the implementation of corporate climate transition plans, to create long- term shareholder value in this critical decade of climate action.
Key developments for Phase Two
In consultation with signatories, the initiative has renewed its three goals, evolved the Net Zero Company Benchmark, enhanced the ways in which investors can participate including the lead investor terms of references, and made marginal updates to the focus list.
Specifically, Climate Action 100+ has:
- Evolved its core goals through to 2030, encouraging signatories to ask companies to move from words to action, by:
- Implementing a strong governance framework which clearly articulates the board’s accountability and oversight of climate change risk.
- Taking action to actively reduce greenhouse gas emissions across the value chain, including engagement with stakeholders such as policymakers and other actors to address the sectoral barriers to transition.
- Providing enhanced corporate disclosure on and implementing transition plans to deliver on robust targets.
- Improved and expanded the ways investors can participate, drawing upon the value and influence of investors to ensure engagement is effective and optimised to drive real change.
The initiative will:
- Introduce a new ‘lead sector investor’ category, to help create the ecosystem conditions needed for sectors to transition.
- Introduce a new ‘lead thematic investor’ category, allowing signatories to engage on specific themes in any given year.
- Enhance the lead engagement model, with stronger and more robust engagement strategies.
In particular, lead investors:
- Will be asked to submit an annual schedule of engagement, specifying actions and escalations strategies they intend to deploy.
- Will be able to opt-in to disclosing their organisation’s identity on the Climate Action 100+ website, providing greater transparency and more ways for investors to be agents of change.
- Will be expected to disclose votes and rationales on Climate Action 100+ flagged votes, where allowable by jurisdiction, practical, and in line with signatories’ own internal policies and business objectives.
- Enhanced the Net Zero Company Benchmark, the details of which were published in March 2023. View the full details here.
Signatories are encouraged to reach out to regional networks should they have further questions following the launch of Phase 2.
For a more information on all changes see our summary of changes here.
Investors have a vital role to play in the zero transition across the global economy
Climate change is reshaping the way the world and the global economy can operate. The science is clear that every increment can worsen the effects. Furthermore, a just transition is critical to enabling the shift to clean energy. Despite the challenges, the transition is accelerating. The global policy environment has never been more supportive of a shift to zero carbon alternatives globally, creating new opportunities for investors, businesses and communities.
As institutional investors seeking to address the material financial risks and opportunities of climate change consistent with their fiduciary duty to their beneficiaries, investor-signatories will work with the companies in which they invest to encourage them to work towards the global goal of halving GHG emissions by 2030 and delivering net zero GHG emissions by 2050, consistent with creating long-term shareholder value and the goals of the Paris Agreement to pursue efforts to limit warming to 1.5°C.
The initiative asks investor signatories to do this by engaging with focus companies to get them to implement a strong governance framework, take action to reduce greenhouse gas emissions across the value chain, and provide enhanced corporate disclosure on, and implement transition plans to, deliver on robust targets.
Members of the Climate Action 100+ steering committee provided comments:
Rebecca Mikula-Wright, CEO of Investor Group on Climate Change, Asia Investor Group on Climate Change and a member of the global steering committee:
“The big emitting companies have made good progress on their commitments and targets to net zero, but the pace of implementation is falling short of where we need to be by 2030.
“This next phase of Climate Action 100+ will provide investors with more opportunities to exercise their active ownerships rights and ensure investors have a reliable, independent way to stay on top of company’s progress, from their capital strategy to real-world emissions reductions.”
Francois Humbert, current Steering Committee chair and lead engagement manager – Generali Insurance asset management (Generali Group)
“Phase 2 is the time to demonstrate the additionality of the initiative, and to work with our investor signatories to support an orderly, just transition for their focus companies.
“Additional expected transparency in our practices will ensure greater accountability, and the new governance of the Steering Committee will enable us to be more representative of the wide diversity of signatories. In addition, the new sector and thematic engagements will enable signatories to bring additional value inside their engagement groups and to the companies they engage.”
Mindy Lubber, President and CEO of Ceres and a member of the global steering committee:
“Over the past five years, Climate Action 100+ has made tremendous strides in engaging with the largest investors and companies to address the material financial risks of climate change.
“The majority of the initiative’s focus companies have made serious commitments to
reach net zero, and some are even beginning to publish transition plans on how they will get there. But now it is time to turn their words into deeds. The economic case for action is stronger than ever, and in this next phase Climate Action 100+ will raise our ambition and expand our efforts to achieve lasting climate action that accelerates the just transition to a zero emissions future.”
Stephanie Maier, Global Head of Sustainable and Impact Investment at GAM investments and a member of the global steering committee:
“Building on the success and lessons learnt from the first five years, Climate Action 100+ now enters its next phase for the critical period up to 2030. Having evolved its core goals following a thorough investor-led consultation, the initiative has a clear strategic focus on moving from corporate disclosure to the implementation of credible transition plans.
” As shown in the first phase of the initiative, investors – many of which have made their own net zero commitments – will continue to have a central role alongside policy makers in supporting companies successfully transition their business models in line with the goals of the Paris Agreement.”
Stephanie Pfeifer, CEO, IIGCC and a member of the global steering committee:
“Climate Action 100+ has been transformative for corporate engagement and the role of investors in the context of climate change. However, there is no hiding from the fact that overall focus companies need to be more action-oriented if they are to support and capitalise on the transition of the global economy.
Ultimately, the case for further and faster corporate action on climate change has never been more compelling – while investors alone cannot bring about this change, Climate Action 100+ remains well-positioned to support this ambitious global goal.”
David Atkin, CEO at the Principles for Responsible Investment,
“The next phase of Climate Action 100+ marks a significant milestone for the initiative. In its ongoing iteration, Climate Action 100+ will provide investor signatories with the tools needed to conduct effective stewardship.
“Investors have direct exposure to the risks and opportunities engendered by the global climate transition and have a vital role to play in using stewardship to manage material systemic risks like climate change, in support of their obligations to clients and beneficiaries.”
About Climate Action 100+
Climate Action 100+ is an investor initiative which aims to ensure the world’s largest corporate greenhouse gas emitters take necessary action on climate change. Over 700 investors, responsible for $68 trillion in assets under management, are engaging companies on improving climate change governance, cutting emissions and strengthening climate- related financial disclosures.
The work of the initiative is coordinated by five investor networks: the Asia Investor Group on Climate Change (AIGCC), Ceres, Investor Group on Climate Change (IGCC), Institutional Investors Group on Climate Change (IIGCC) and Principles for Responsible Investment (PRI). It is supported by a global Steering Committee.
Climate Action 100+ launched in December 2017, garnering immediate worldwide attention. The initiative has since become the largest ever global investor engagement initiative on climate change, with growing influence and impact. Climate Action 100+ was initially launched as a five-year initiative (2017-22). In 2023, it announced its second phase to run from 2023 to 2030.
Follow CA100+ on Twitter: @ActOnClimate100.
Legal Disclaimer
Climate Action 100+ does not require or seek collective decision-making or action with respect to acquiring, holding, disposing and/or voting of securities. Signatories are independent fiduciaries responsible for their own investment and voting decisions and must always act completely independently to set their own strategies, policies and practices based on their own best interests. The use of particular engagement tools and tactics, including the scope of participation in Climate Action 100+ engagements, is at the discretion of individual signatories. Climate Action 100+ facilitates the exchange of public information, but signatories must avoid the exchange (this includes one-way disclosures) of non-public, competitively sensitive information, including with other signatories, participants in engagements, Climate Action 100+ itself, and its investor networks. It is important to note that an exchange of information can achieve the same end as an explicit agreement and it is important to avoid exchanging information which might result in a breach of competition law, even if only inadvertently. Signatories may not claim to represent other signatories or make statements referencing other signatories without their express consent. Any decision by signatories to take action with respect to acquiring, holding, disposing and/or voting of securities shall be at their sole discretion and made in their individual capacities and not on behalf of Climate Action 100+, its investor networks or their other signatories or members. Signatories must avoid coordination of strategic behavior between competitors that impacts or is likely to impact competition. Climate Action 100+ and its investor networks do not act or speak on behalf of each other or Climate Action 100+ signatories. They also do not seek directly or indirectly, either on their own or another’s behalf, the power to act as proxy for a security holder and do not furnish or otherwise request, or act on behalf of a person who furnishes or requests, a form of revocation, abstention, consent or authorization. In addition, Climate Action 100+ does not provide investment or voting recommendations, and signatories are not obligated by Climate Action 100+ to make investment or voting recommendations based on the investment or voting behavior of other signatories. Climate Action 100+ and its investor networks do not provide investment, legal, accounting or tax advice. Climate Action 100+ and its investor networks do not necessarily endorse or validate the information contained herein.