JSE-listed Ninety One has become the first South African asset manager to sign onto the Net Zero Asset Managers Initiative, the group announced on Tuesday.
The international initiative is aimed at supporting institutional investing aligned with the global goal of achieving net zero emissions by 2050 or sooner.
“This commitment underlines Ninety One’s support for the objectives of the Paris Agreement and global efforts to limit global warming to 1.5°C and aligns with the United Nations Sustainable Development Goals,” the group said.
Commenting on the move Hendrik du Toit, CEO of Ninety One, said: “Ninety One believes in sustainability with substance. The world needs an inclusive transition plan that works for all its 7.9 billion people.”
He stressed that the drive to net zero carbon must include the entire world.
“The carbon-intensive emerging market economies need time, encouragement and resources to adjust,” says Du Toit.
“Ninety One, as a company with its roots firmly in South Africa, understands this need perhaps better than most. Emerging economies, after all, are not responsible for the bulk of emissions to date.”
Ninety One, formerly Investec Asset Management, was unbundled from Investec plc in March last year and listed separately on the London Stock Exchange and the JSE. Dubbed an independent ‘active global asset manager’, Ninety One manages more than R2.7 trillion in assets as at March 31.
The overall assets represented in the Net Zero Asset Managers Initiative comprise almost half of the entire asset management sector globally in terms of total funds managed, according to Ninety One.
“A total of 128 investors including the world’s three largest asset managers – collectively managing $43 trillion in assets – are now part of the initiative,” it said.
“Signatory asset managers commit to prioritise the achievement of real economy emissions reductions, take account of material portfolio Scope 3 emissions [resulting from activities from assets not owned or controlled by the reporting organisation], create investment products aligned with net zero emissions and facilitate increased investment in climate solutions,” the group added.
“Beyond this, it is fitting that Ninety One is the first South African signatory because of its unique position to make the case not merely for a transition to cleaner forms of energy, but a just transition that takes into account the unique socioeconomic challenges South Africa faces as it works to decarbonise the economy,” Ninety One pointed out.
As part of its drive to achieve low-emission investment portfolios, Ninety One said that its intention is to do more than lower ‘portfolio carbon’ by simply constructing portfolios that exclude high-emitting countries and companies. Instead, the group seeks to differentiate between the reduction of ‘portfolio carbon’ and the reduction of carbon emissions across the real economy.
“Ultimately,” said Du Toit, “the drive to net zero is about the reduction over time of all the world’s carbon, not merely of ‘reported’ carbon, and true success is about bringing every country and sector along on the same journey.”