Investors play a critical role in tackling the challenges humanity is facing at the moment. Due to the portfolios and assets they manage, investors have a huge impact on financial markets and economic activities. Their investments decide about how money is used. Responsible investments can mobilize financial markets to drive economy into a more sustainable future. Considering climate change the so-called Portfolio Decarbonization Coalition (PDC) plays a crucial role in this context as it aims to catalyze action by investors to drive a low-carbon economy. Further information about PDC is given below.
About the Portfolio Decarbonization Coalition
The Portfolio Decarbonization Coalition is a multi-stakeholder platform that in 2014 was co-founded by the organizations Amundi, AP4, CDP and UNEP FI. Its main goal is to reduce global emissions by encouraging investor companies to decarbonize their investment portfolios. By joining the initiative investors send a strong signal and take part in the needed global transition to economic climate neutrality. What else?
- PDC is action oriented: members will commit to a decarbonization plan
- Transparency is key: investors have to disclose the carbon footprint of their investments as well as the methods used for decarbonizing their portfolio
- Exchange is guaranteed: further objectives are co-learning, sharing experience and knowledge transfer
How to achieve a reliable portfolio decarbonization?
Trustable portfolio decarbonization can be achieved by several strategies, e.g. by:
- reallocating (invested) capital into carbon efficient companies, renewable energy projects, low emission technologies, etc.
- investments on the basis of companies’ carbon footprints and emitted GHGs to set incentives for those companies to implement measures that decrease their negative climatic impact
- initiating constructive carbon-related dialogues with the companies
- following and learning from best-practice approaches
How to become a member?
The PDC initiative defined different membership criteria depending on the type of the investment company.
An asset owner organization will be accepted as a PDC member as long as it:
- professionally manages money,
- submits written commitment to ‘decarbonize’, within a specific time horizon,
- is willing to have that commitment made public by PDC and
- is fully and publicly committed, at CEO or trustee level, to promoting the PDC and its recruitment activities among peers.
An asset manager organization will be accepted as a PDC member as long as it:
- submits written confirmation that it already is supporting, or firmly planning to support, at least one asset owner in portfolio decarbonization or similar climate-related capital re-allocation efforts, and
- is fully and publicly committed, at CEO level, to promoting the PDC and its recruitment activities among peers.’ (see PDC, 2020)
So far, 32 investors have become a member of the Portfolio Decarbonization Coalition. There are several well-known companies among them: e. g. Allianz, RobecoSAM, BNP Investment partners.
Climate change is an urgent challenge we have to tackle within the next years. Act now!
DFGE has been working in the field of sustainability and climate action for more than 20 years and is willing in supporting your company in their climate management, e. g. by calculating the Corporate Carbon Footprint, the Product Carbon Footprint, the Science Based Targets or by defining a holistic climate strategy. That increases the chances to get seen by investors who committed to allocate their investments responsibly. Don’t hesitate to contact us via mail () or by phone under +49.8192.99733-20.