The Net Zero Asset Managers (NZAM) initiative has unveiled its latest report, ‘the Net Zero Asset Managers Target Disclosures Report 2024’, showcasing the growing number of voluntary net zero commitments from the asset management industry.
Since the last disclosure announcement, the initiative has seen over 30 new asset managers join its ranks, bringing the total to over 90 who have disclosed targets. As of January 31, 2024, a total of 264 signatories have established and disclosed targets to guide their individual net zero investment practices. This marks significant growth for the initiative, which began in December 2020.
The report highlights that more than 325 asset managers, overseeing assets totaling over $57.5 trillion, have made individual commitments in alignment with their fiduciary duties. The report provides new insights into the geographical distribution of signatories and the target-setting methodologies employed.
According to the report, decarbonisation targets are the most common, representing 62.5% of targets. Additionally, 53% of signatories have set alignment targets, while 23% have established engagement targets.
The signatories are addressing climate risk both in the short and long term, with 98% setting interim targets for or before 2030. Over a quarter (26%) have set their first target for 2025.
Among disclosing signatories, 51% use the Paris Aligned Investment Initiative’s Net Zero Investment Framework, 22% follow the Science Based Targets initiative for Financial Institutions, 14% adhere to the Net Zero Asset Owner Alliance Target Setting Protocol, 12% use a combination of these methodologies, and 10% employ their own unique approaches.
The initiative demonstrates global reach with signatories based in over 35 countries. Europe leads with over 200 signatories, followed by North America with over 70, and Asia with over 20. Oceania has 17 signatories, while South America and Africa have seven and one, respectively.
Members of the NZAM Steering Committee and CEO and President of Ceres, Mindy Lubber said, “This latest target disclosures report highlights the meaningful progress of asset managers in addressing risks and opportunities as they transition to a net zero future. It’s encouraging to see asset managers worldwide setting ambitious net zero emissions targets and implementing concrete transition plan strategies to address climate risks and seize investment opportunities across their portfolios.”