The UN Joint Staff Pension Fund (UNJSPF) has joined the UN-convened Net-Zero Asset Owner Alliance (NZAOA) as it looks to have its target-setting framework ready for external feedback by the end of this month.
UNJSPF’s joining means the coalition has gained 15 members since it formally launched in September last year.
In a statement, the UN pension fund’s investment management office said: “As a pension fund with long-term investment horizons and liabilities, UNJSPF is vulnerable to the financial impact resulting from both transition and physical risks caused by climate change. It is our fiduciary duty to protect the long-term financial interest of our beneficiaries.”
“As codified in the Paris Climate Agreement and United Nations Sustainable Development Goals, we have a key role to play in catalysing decarbonisation of the global economy and investing in climate resilience,” it added.
It also said that joining the alliance would give it “access to the best-in-class knowledge from peers on Paris-aligned climate finance change and will help enhance our sustainable investing approach to convert our assets to carbon neutrality by 2050”.
Investors joining the NZAOA commit to action to reduce the greenhouse gas emissions associated with their investments to net-zero by 2050, to be aligned with the Paris Agreement goal of limiting global warming to 1.5°C above pre-industrial levels. There is a strong emphasis on engagement, with asset managers and policymakers as well as corporates, as the means of delivering on the group’s net-zero commitment.
As part of this, the group is very much seeking to advance the state-of-play with respect to net-zero portfolio target-setting. Members of the NZAOA commit to setting and publicly reporting on intermediate portfolio decarbonisation targets.
The first such targets have yet to be published, but according to Anqi Dang, sustainable investment analyst at Allianz, one of the NZAOA initiating organisations, the tentative timeline is for the group’s target-setting framework to be ready for external feedback by the end of this month.
The idea would be to be able to publish the finalised framework on the NZAOA website by the end of September, and for individual members of the group to have a bit more time to elaborate their respective targets, by the end of this year or perhaps the first quarter of next year for some members.
Anqi was speaking during a webinar held last month by think tank 2° Investing Initiative in the context of international climate reporting awards that the latter organises with the French ministry for ecological transition and others.
She emphasised that the NZAOA’s main focus was to have “real world impact”. In an apparent nod to some criticism of net-zero commitments, she said that alliance members were seeking portfolio emission reductions to “absolute zero”, but that the existence of hard-to-abate sectors entailed the necessity to consider carbon offsetting or negative emission technologies.
This would only be as a “parallel effort or last resort,” she said.