On the sidelines of the Paris Climate Change Conference, the Portfolio Decarbonization Coalition (PDC) formally announced its two newest members and released its first annual report describing the decarbonization strategies of its members and suggesting priorities for future action.
7 December 2015: On the sidelines of the Paris Climate Change Conference, the Portfolio Decarbonization Coalition (PDC) formally announced its two newest members and released its first annual report describing the decarbonization strategies of its members and suggesting priorities for future action.
The Coalition announced that two of the world’s largest institutional investors, Allianz and SBP, joined the PDC, bringing its membership to 25 investors overseeing the decarbonization of US$600 billion in assets under management (AUM), surpassing the target of US$100 billion AUM set by the Coalition at its creation in September 2014.
The annual report provides an overview of the decarbonization approaches and strategies of its 25 members, including investing in renewable energy, energy efficiency and clean technology, reducing or excluding investments in fossil fuels, shifting capital from higher to lower carbon intensity enterprises, and encouraging companies in their portfolios to reduce emissions and support the transition to a low-carbon economy. The PDC says that the report shows that investors can decarbonize their portfolios without harming investment performance.
The report recognizes that more needs to be done if decarbonization strategies are to be more widely adopted. It indicates priority areas for future PDC action, including: developing investment tools and solutions that enable investors to decarbonize their portfolios without compromising investment performance; developing the investment case for decarbonization; strengthening corporate and investor reporting; and improving understanding of the contribution that portfolio decarbonization can make to the goal of a low carbon, climate resilient economy and the time frames over which this contribution can be made.
Co-founded by UN Environment Programme (UNEP) and its Finance Initiative (UNEP FI), the Fourth Swedish National Pension Fund (AP4), Amundi and CDP (formerly the Carbon Disclosure Project) at the September 2014 Climate Summit, the PDC is a multi-stakeholder initiative seeking to reduce global greenhouse gas emissions by mobilizing a critical mass of institutional investors committed to gradually decarbonizing their portfolios. Coalition members commit to measuring and disclosing the carbon footprint of their investment portfolios on an annual basis and to taking action to decarbonize their investment portfolios. [UNEP-FI Press Release on New PDC Members] [Publication: From Disclosure to Action: The First Annual Report of the Portfolio Decarbonization Coalition] [PDC website]