The UN-convened Net-Zero Asset Owner Alliance welcomes the UN High-Level Expert Group on the Net-Zero Emissions Commitments of Non-State Entities’ (HLEG) report , which highlights the much-needed pursuit of a “roadmap to prevent net zero from being undermined by false claims, ambiguity and ‘greenwash’”.
The HLEG echoes the Alliance’s view that the pursuit of net zero emissions by 2050 is even more urgent amid the ongoing energy security crisis, geopolitical uncertainty, and intensifying extreme weather events. HLEG’s recommendation that a net-zero pledge “must contain steppingstone targets for every five years” affirms progress asset owner members have made setting and reporting on intermediate targets: the Alliance’s second Progress Report indicated 44 members have set short-term (2025 and 2030) targets, covering two-thirds of the Alliance’s total assets under management, or US$7.1 trillion.
The Alliance wholeheartedly agrees with the HLEG on the importance of mobilising investor influence, engagement and capital for low or zero emission investments in developing countries. Alliance members’ long-term commitments and operational short-term decarbonisation targets cover their global investments, across both developed and developing countries. In addition, the Progress Report showed that 35 members (representing a total of US$6.2 trillion AUM) set Financing Transition targets. Those members are reporting on their climate solutions investments, with the intention of progressively growing the invested amount. So far, Alliance members invested US$253 billion into climate solutions in both developed and developing countries, with 30% of these investments being in the energy sector.
Alliance members are proactively engaging with all relevant stakeholders (policymakers, development finance institutions, asset managers and other experts)—via webinars, workshops and publications’—to find and work on tangible solutions for scaling climate finance and transition investments into developing countries. The Alliance identified blended finance as an effective structuring approach (supporting private capital mobilisation by improving the risk profiles of investment opportunities) and has called for its scaling in emerging markets and developing economies.
Of particular note is the HLEG’s recommendation to create a level playing field by “developing regulation and standards starting with high-impact corporate emitters, including private and state-owned enterprises and financial institutions.” The creation by countries of a taskforce on net-zero regulation, to convene regulators across borders and across regulatory domains, would go a long way to hastening the transition to net-zero emissions and improve credibility and trust in the essential decarbonisation of the real economy.
The Alliance Secretariat, with the assistance of relevant workstreams, is assessing the report in more detail and plans to report back to members in due course.
About the UN-convened Net-Zero Asset Owner Alliance
The UN-convened Net-Zero Asset Owner Alliance is convened by UNEP’s Finance Initiative and the Principles for Responsible Investment (PRI). The Alliance is supported by WWF and Global Optimism, an initiative led by Christiana Figueres, former Executive Secretary of the United Nations Framework Convention on Climate Change (UNFCCC). The 78 Alliance members have committed i) to transitioning their investment portfolios to net-zero GHG emissions by 2050 consistent with a maximum temperature rise of 1.5°C above pre-industrial levels; ii) to establishing intermediate targets every five years, and iii) to regularly reporting on progress.