The CHF21.9bn (€21.4bn) pension fund for the Swiss canton of Geneva has decided to pursue the goal of rendering its investment portfolio carbon-neutral by 2050 and gradually disengaging from fossil fuels.
In a statement yesterday, Caisse de prévoyance de l’Etat de Genève (CPEG) said it was “raising its ambitions” with regard to responsible investment.
Its committee, the pension fund’s main governance body, has adopted a responsible investment charter and a climate strategy aligned with the Paris Agreement’s goal of keeping global warming to 1.5°C above pre-industrial levels.
It said it was committing to halve the greenhouse gas emissions associated with its investments by 2030 and to reach net-zero by 2050. The pension fund also said it had adopted the goal of a gradual, or progressive, disengagement from fossil fuels.
Asked for more information about the latter, Alessia Torricelli, chief financial officer of CPEG, told IPE: “CPEG advocates dialogue with companies to change practices and contribute to the energy transition. The gradual disengagement will take place in temperature steps, i.e. companies which, through their current action and their future intention, are on a temperature trajectory that does not comply with our steps will be excluded.”
The pension fund has said it will start reporting on progress in this area from next year. CPEG did not quantify its exposure to fossil fuels.
Asked whether CPEG would be joining either the UN-convened Net-Zero Asset Owner Alliance or making a commitment under the Paris-Aligned Investment Initiative, Torricelli said CPEG had recently signed up to the Principles for Responsible Investment and would be prioritising the implementation of that.
“We do not rule out future engagements with other partners,” she said.
In its new charter, CPEG identifies four responsible investment pillars: systematic integration of environmental, social and governance (ESG) criteria, engagement with companies, exclusion, and impact investing.
“The four pillars make it possible to combined dynamism and continuity with the rigorous selection of investments,” it said.
The committee that approved the responsible investment charter started its term, which runs until 2025, on 25 March.