The 26th United Nations Conference of Parties on climate change (COP26) will be held in Glasgow on 1-12 November 2021. It’s considered to be the most important climate conference since the 2015 Paris Agreement.
We’re taking part in a programme of events to highlight what actions investors can take to help achieve real world decarbonisation – and to underline the urgent need for stronger climate policies to support investing in line with net zero goals.
For us as investors, the transition and physical risks of climate change are material across many regions and sectors. The recent report by the UN’s Intergovernmental Panel on Climate Change (IPCC) provides the latest evidence on the physical impacts of climate change and is referred to as ‘code red for humanity’. It highlights that extreme weather events will be more severe, more frequent and affect every region on the planet, with possibly irreversible tipping points being reached.
COP26 is seen by many as the last opportunity for putting pledges into practice to avert a climate catastrophe.
Our abrdn Research Institute recently outlined what we believe needs to happen to make COP26 a success and achieve the goals of the Paris Agreement more effectively. The window for achieving the objective of reaching net zero emissions by 2050, and keeping the global average temperature rise at 1.5°C above pre-industrial levels, is rapidly closing. Current policy pledges are expected to result in an average temperature rise of 2.4°C.
Eva Cairns, our Head of Climate Change Strategy, commented:
“Finance is recognised as an important pillar of the COP26 agenda. But what investors and corporates are able to achieve when it comes to climate goals is heavily dependent on the policy framework in which they operate. We urgently need ambitious and binding climate commitments from national governments – widespread political buy-in backed by clear, durable legislation, including higher carbon pricing.
We want to use our voice as a larger global asset manager to influence policy makers and corporates, and demonstrate how the climate capabilities we have developed can be part of the solution.”
Ahead of and during COP26, we’ll be demonstrating the way we think about both contributing to the global net zero goal and enabling our clients to achieve their climate objectives.
We also want to use our influence to highlight the fact that, to enable investors to allocate capital in line with net zero trajectories, much more policy action is required. This is particularly important in certain regions and industries where decarbonisation is more difficult.
We will be participating in a programme of external events to highlight our climate change expertise. Key events we support as partners include:
We’re also continuing our own Global Climate Action Series of online seminars. The next one, on Thursday 21 October, focuses on our hopes and expectations for COP26.
As signatories to the Net Zero Asset Managers initiative, we are proactively developing solutions and working with our clients to enable them to achieve their net zero goals. We focus on understanding the impact of climate scenarios on our investments, identifying transition leaders to decarbonise portfolios, investing in climate solutions, and active ownership to support real world transition.
Within our own operations, we have set an ambitious interim science-based target, to achieve a 50% reduction against our 2018 baseline in our operational emissions by 2025. This is five years earlier than the latest climate science deems necessary to meet the goals of the Paris Agreement.
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