Jyske Bank joins Climate Action 100+
25.11.2021
Jyske
Bank joins a global initiative with a large number of other asset managers,
which together will influence the world's 100 largest CO2 emitters to become
more sustainable.
As part of Jyske Bank's focus on green conversion, the bank is now participating in a global initiative called Climate Action 100+, in which more than 600 asset managers work together to influence the companies that emit the most CO2 worldwide.
The bank is also part of Net Zero Asset Managers, which is committed to making all the bank's investment portfolios net CO2-neutral by 2050. To succeed in that mission, it requires that the companies in which the bank's customers are invested become more sustainable, and this is where Climate Action 100+ comes into the picture.
Together with a large number of other significant investors around the world, Jyske Bank will try to influence the largest CO2 emitters to become greener. With the goal of making the bank's own investments net CO2-neutral, there is a need for a larger and more comprehensive strategy to push for the green transition in the industries that have the greatest climate impact. In this way, the bank's own investments will also be affected as the companies become greener.
Specific
requirements for companies
The collaboration works by smaller groups of investors taking care of the contact with the individual companies, and thereby getting involved on behalf of the entire investor group. The idea is that Climate Action 100+ stands as a strong player with real influence, due to the significant investments in the companies in question.
Kenneth Styrbæk, Vice President and ESG Manager of Jyske Capital, the bank's asset management, will be at the forefront of the bank's commitment to Climate Action 100+. According to Kenneth Styrbæk, there are a few fundamental requirements that apply across the companies.
Specifically, the companies must i.a. set targets for their CO2 emissions by 2030 and make sure they are net CO2 neutral by 2050. In addition, companies will be made to have responsible lobbying activities.
"They are in a great way helping to influence the political agenda both directly and through membership of trade associations. Here, we want to bring to light which organizations they support, and have them take responsibility for the fact that their trade association may be helping to pull in a different direction than the company's own climate strategy and the green agenda in general, ”explains Kenneth Styrbæk.
Additional
Benefits
The association also functions as collective knowledge sharing, where investors can take good advice from one company to another and thus promote development.
Kenneth Styrbæk is of the conviction that companies can therefore enjoy the benefit of investors' commitment.
"I believe they also feel that they get something back by engaging in this dialogue. They get valuable input on which methods work best in a particular industry. At the same time, they do not have to talk to 100 investors - they can make do with fewer at once and with a common agenda".
According to Kenneth Styrbæk, investors' demands do not stand as an ultimatum with the consequence of withdrawing as an investor if the company does not comply with all proposals. However, both Jyske Bank and the other asset managers make decisions based on the company's willingness to adjust and become more sustainable. He emphasizes that those decisions are made solely on the basis of individual considerations.
"We neither can, nor will we work together to coordinate our withdrawal as investors. In spite of this, companies need to know what you as an investor want them to do,” he explains.
"It is not the threat aspect that must be the driving force behind a good dialogue. It is evident that it can be a step you take at some point if you do not experience any development. However, the advantageous approach is to have an open and precise dialogue in relation to what you want to change,’’ says Kenneth Styrbæk.
Real
Changes
If Jyske Bank were to influence only the companies in which it is currently invested, a top 100 list would be different from the Climate Action 100+ list. There would be a few overlaps, but such a list would only provide a snapshot view.
"It is too narrow to only look at our current investments, even though this is where we initially have an effect. However, we want real change and not just in our portfolios. Therefore, it is obvious that the 100 largest CO2 emitters in the world are the ones in consideration. If you can make them change, you will make the whole picture change, ”says Kenneth Styrbæk.
Not all industries have the same prerequisites for adapting in a more sustainable direction, and due to this, the companies are assessed individually and met by different requirements.