UN Climate Summit: UNEP FI and investors launch plan to ‘decarbonize’ institutional investment

New ‘Portfolio Decarbonization Coalition’ will reach out to global investors

The United Nations Environment Programme and leading institutional investors have launched an ambitious plan to ‘decarbonize’ an initial $100bn of investment.

The new Portfolio Decarbonization Coalition (PDC) initiative, unveiled at the UN Climate Summit in New York today (September 23), has been put together by the UNEP Finance Initiative (UNEP FI), Swedish state pension fund Fjärde AP-fonden (AP4), France-based asset manager Amundi and environmental data body CDP. The PDC is also supported by the China International Capital Corporation, the joint venture investment banking and research firm that’s backed in part by Singapore state investor GIC.

The coalition aims to convene “a critical mass” of investors committed to measuring and disclosing the carbon footprint of a minimum of $500bn of investment.

Subsequently investors will commit to substantially reducing their carbon footprint with an intermediate target of $100bn by December 2015.It’s hoped investors who join the coalition will lessen their carbon exposure – both in terms of current emissions and potential emissions from current fossil fuel reserves.

The coalition says it will “reach out” to institutional investors worldwide, aided by the UN-supported Principles for Responsible Investment (PRI) and other networks. AP4 Chief Executive Mats Andersson said the $100bn initial target was “absolutely feasible”. “And we hope that by reaching this target, investors can show that a different course of action is possible, where institutional investors’ goals are aligned with, and support the common good,” he added. Achim Steiner, UN Under-Secretary-General and Executive Director of UNEP, said the initiative enables investors to take action on climate change “through their own portfolios”. CDP Executive Chairman Paul Dickinson called the project “the next logical step” for investors looking to reduce their carbon impact at a portfolio level.