The Institutional Investors Group on Climate Change (IIGCC) has launched its Net Zero Investment Framework, with 21 asset owners using it to commit to achieve net zero alignment by 2050, or sooner.

The framework will be rolled out globally as the basis for investors worldwide to implement their net zero strategies. It aims to help investors ensure their investment portfolios are aligned with net zero emissions and investors are working in a comprehensive manner to help deliver on the goal of the Paris Agreement to keep global warming below 1.5°C.

The 21 assets owners, with $1.2trn of assets, will use the framework to help them achieve their commitment of net zero by 2050, alongside a number of asset managers who are already working with clients on net zero alignment. This means 35 investors, managing $8.5trn in assets – including both asset owners and asset managers – are already putting the framework to practical use.

Several of these are pension funds or providers, and include the Environment Agency Pension Fund, New York State Common Retirement Fund, National Grid UK Pension Scheme, the Church of England Pensions Board, PKA, Brunel Pension Partnership, Northern LGPS (covering the Greater Manchester, Merseyside and West Yorkshire local government pension scheme funds), PensionDanmark, AP2, Lloyds Banking Group Pensions Trustees Limited, Nest Corporation, and Bundespensionskasse AG.

IIGCC CEO, Stephanie Pfeifer, said: “The global investment community has been called on to play its part in the transition to net zero – and it is answering that call. This new swathe of net zero commitments from asset owners demonstrates the growing determination from investors to make important decisions to support a net zero and resilient future.”

“Commitments are vital, but only meaningful for the long-term when realised. The net zero transition itself requires an ongoing transition from making commitments to delivering impact. The Net Zero Investment Framework, developed with and for investors, is a blueprint for action that will enable and support investors in reaching these goals.”

In addition, Church of England Pensions Fund chief responsible investment officer, Adam Matthews, said: “It is easy to make a long-term commitment to be net zero, but the key question is the path you take to achieve it. We have jointly chaired this process to pool the expertise and wisdom of the asset owner and fund manager community to create a framework that is both practical and credible and gets you to net zero. This is a vital part of the investment architecture that was missing. As a fund we are committed to using this Net Zero Investment Framework and are delighted to make the Asset Owner commitment today.”

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