According to TAI, pension funds remain the largest group of asset owners worldwide, accounting for over 58% of assets, followed by sovereign wealth funds (34.7%) and outsourced CIOs and master trusts combined (7.2%).
The capital held by the world’s 100 largest wealth owners rose 15.7% last year to $ 23.5 trillion.
Roger Urwin, Co-Founder of the Thinking Ahead Institute, said, “This relatively small group of investors is right at the forefront of the investment community’s battle to go net zero, and their power is even more concentrated in the top 20 for them responsible for nearly $ 13 trillion. “
Net Zero AM Initiative – the five companies with the lowest initial commitments
The TAI study found that there are only three accredited net zero committed organizations among the top 20 asset owners and only 14 among the top 100.
Urwin added, “While the pledges made by the Glasgow Financial Alliance for Net Zero (GFANZ) organizations are critical, the largest wealthy owners hold the ‘key to the lock’ door to net zero paths.
“But to successfully cope with the complexities and challenges of sustainable investing and net zero paths, asset owners need to develop improved governance and investment literacy.
“The Glasgow COP Summit demonstrated how asset owners can work together in a broader collaborative framework to achieve better long-term results for the whole system.”
TAI research argued that the development of “system leadership” practices that recognize the extent and interconnectedness of climate change will support “much needed” innovation and collective action.
However, asset owners face and overcome numerous obstacles, including the narrow interpretations of fiduciary standards that have forced them to maintain established practices.
Urwin concluded, “The research shows how some groups of property owners have sought to overcome these barriers by ‘maturing’ their governance, investment and sustainability models and redesigning their organizational purpose for the upcoming transformative change, and other property owners should be aware of the change Take note. ”