measuring portfolio alignment gfanz

If financial institutions are to deploy the capital required to usher in the net-zero transition, they need a way to measure whether their financing activities align to their ambition. GFANZ proudly announced its members were already aligning their portfolios with 1.5C; 90 of its founding institutions had already set short-term climate targets, including 29 asset owners committed to reducing portfolio emissions by 25-30% by 2025. | The Glasgow Financial Alliance for Net Zero (GFANZ) is a practitioner-led, global coalition of financial sector institutions and their sector-specific alliances. Previously, Edward was with the Church Commissioners for England for 11 years, and was the head of responsible investment since 2014. It outlines the progress that GFANZ has driven in critical areas such . InvestmentNews ESG Summit & Film Festival. Language: english. The draft Glasgow Financial Alliance for Net Zero (GFANZ) Portfolio Alignment Measurement report is out. Press release https://lnkd.in/ep8xKHTa Action inspires action. Portfolio alignment measurement: supporting the development and effective . With huge thanks to the GFANZ and Oliver Wyman team, especially Anja Ludzuweit, CFA, Alex Spencer and Christopher Johnstone. Jeanne Martin, ShareActions head of banking programme said she was extremely concerned about the decision amid the IEAs estimates. Carbon Tracker Expectations of GFANZ. Portfolio Alignment Measurement - Financial institutions and climate data providers need to work together to address barriers to implementation and using portfolio alignment metrics; . Vanguard, one of the largest investment managers in the world, announced today that it is withdrawing from the Net Zero Asset Managers initiative (NZAM), a major multi-trillion dollar group of investment managers committed to supporting the goal of net zero greenhouse gas emissions by 2050. GFANZ is seeking feedback on the guidance and enhancements to critical inputs for measuring portfolio alignment by 12 September. -#Emissionsdata for 70K+ individual sources worldwide Assets allocated to the energy transition reached just 67bn in 2021 across emerging and developing economies, the lowest level since 2017, a report from the Glasgow Financial Alliance for Net Zero (GFANZ) has found. This report sets the standard for measuring the alignment of financial portfolios with the 1.5C goal of the Paris Agreement. We deep dive into what climate metrics financial practitioners . Faversham House Ltd 2022 edie news articles may be copied or forwarded for individual use only. Ahead of COP27, Glasgow Financial Alliance for Net Zero (GFANZ) has issued a report on Measuring Portfolio Alignment for financial institutions, providing a clear framework to help FIs navigate net zero portfolio methodologies. The coalition said the finance industry will need credible, forward-looking metrics to help it measure their progress on net-zero commitments and to reallocate capital to support the transition. Source: GFANZ . Finally, GFANZ has today released a guide to portfolio alignment for net zero. Created by: Phyllis Black. The report proposes and seeks guidance on portfolio alignment use cases as well as enhanced guidance for designing and implementing portfolio alignment metrics. Ever since its foundation, it has faced calls to clarify how it plans to get members to reduce their financed emissions in a science-based manner. "To measure portfolio alignment, financial practitioners should consider nine key decisions, the key design judgements," said Anja Ludzuweit, executive director of portfolio alignment measurement for GFANZ. The draft Glasgow Financial Alliance for Net Zero (GFANZ) Portfolio Alignment Measurement report is out. It explores the different types of use cases for those metrics and identifies the barriers to adoption. This brings total number of asset managers that have set initial targets to 169. Strengthening accessibility of GFANZ in APAC September 2022: Held Measuring Portfolio Alignment - Investors who dont take sustainability factors into account arent fulfilling their fiduciary duty The Glasgow Financial Alliance for Net Zero (GFANZ) is consulting the financial industry on the portfolio alignment metrics used to evaluate whether companies are on target to achieve their net-zero transition. The report also stipulates that GFANZ has dropped a requirement for its members to sign up to the UN-backed Race to Zero campaign. This Package provides access to the entire event, Executive Director of Portfolio Alignment Measurement. Rather than accepting [company commitments] at face value, practitioners should evaluate their credibility.. Speaking at the launch of todays suite of GFANZ reports, Mary Shapiro, vice-chair of GFANZ, addressed concerns by saying the Alliances mission remains the same. Published on: 12 Aug, 2022, 3:56 am. All rights reserved. It is that, but in addition, it makes some hard-hitting points about sustainability politics. Measuring Portfolio Alignment: Enhancement, Convergence, and Adoption aims to offer guidance on multiple technical aspects, structured around 9 'key judgments'. We've expanded access to sustainability-related metrics in core Aladdin tools from ~1,200 in 2020 to more than 8,000 in 20212. With todays transition planning framework, we can accelerate the speed and scope with which these enormous financial resources are put to work to achieve the worlds goals.. The report outlined the PAT's views on portfolio alignment metrics and areas of further work as a resource for organizations interested in exploring portfolio alignment. GFANZ issued a report to provide guidance, clear definitions and case studies for financial institutions looking to develop and use portfolio alignment metrics to start decarbonizing their portfolios. The framework also claims that investors should manage the phase-out of high emitting assets that would likely become stranded under a net-zero transition, but GFANZ stopped short of cancelling support for fossil fuel firms as a whole. Glasgow Financial Alliance for Net Zero is seeking public comment on new Portfolio Alignment Measurement Report, which aims to set out how financial firms can deliver on net zero goals. Please login or Register to leave a comment. 21 managers have joined the initiative since the previous target disclosures update in May 2022, bringing the total number of signatories to 291, representing more than USD 66 trillion in AUM. But governments are still being chicken about meat, and have barely begun to experiment with public policies that could drive down consumption. Together, they work to accelerate the world's transition to . The GFANZ was established ahead of COP26 last year in what was regarded as the global financial sectors biggest collaboration on the net-zero transition. Read more on what is needed to save nature here: https://bit.ly/3GkHttV, Todays Climate TRACE data release covers more than ever before: If financial institutions are to deploy the capital required to usher in the net-zero transition, they need a way to measure whether their financing activities align to their ambition., She added: Building upon the implementation of sound financial sector and real-economy transition plans as well as science-based net-zero pathways, GFANZs Portfolio Alignment Measurement Report will help financial institutions use metrics to assess whether their portfolio companies are 1.5C-aligned or need resources to transition., David Blood, senior partner of GFANZ-member Generation Investment Management, added: Measuring portfolio alignment is essential for financial institutions to understand their progress in reaching net-zero and allocating capital to transition finance opportunities for the real-economy.. GFANZ the coalition launched at COP26 last year of, now, 550 financial institutions committed to net zero by 2050 today published its Actions to Mobilize Capital to Emerging Markets and Developing Economies report alongside its net-zero framework for finance firms, an updated call to action for policymakers and a guide for portfolio alignment. The process of measuring alignment is forward-looking and considers a companys future emissions based on transition planning and emissions reduction commitments, she continued. For this report, the PAT has engaged with eleven of the world's foremost portfolio alignment method . GFANZ has stated that, going forward, members will be encouraged, but not required, to partner with the Race to Zero. #Deforestation has been declining, but to salvage what is left of the biological richness of life on Earth it needs to stop immediately. Learn more about the sustainability of the global food market: https://bit.ly/3F8mr0T, Heat pumps are an essential technology to reduce the emissions created by buildings. GFANZ uses the term "orderly transition" to refer to a net-zero transition in which both private sector action and public policy changes are early and ambitious, thereby limiting economic disruption related to the transition (e.g., mismatch . 4 Our planet's average temperature is already 1.1 degrees C warmer than pre-industrial levels, with the last five This webinar will discuss the August GFANZ Portfolio Alignment report, which provides a practitioner perspective for measuring the alignment of investment, lending, and underwriting activities with the goals of the Paris Agreement and critical 2050 global net-zero objectives. Thanks to all 50+ organizations who engaged with us to get the report to this stage, as well as the technical leadership of Anja Ludzuweit, CFA, and with the support of Edward Mason and David Blood. Oliver Wyman provided knowledge and advisory support. In its updated call to action, the Alliance is asking governments to undertake their own net-zero transition planning sector by sector and has identified five areas for further action more transition planning, consensus around frameworks, address uncertainty of carbon markets, creating incentives for transitioning, and supporting emerging markets and developing economies with new architecture to transition. Concerns were raisedby organisations including ShareAction, Global Witness, Sierra Club and 350.org over the continued support for fossil fuels of many major players in the finance sector, out of alignment with the new Race to Zero requirements. Charged: A History of Batteries and Lessons for a Clean Energy Future by James Morton Turner, positions itself as a history of batteries. These nine decisions are grouped in three steps: building a benchmark, comparing company-level alignment against this benchmark and then aggregating this. https://lnkd.in/eyNPPc6B, Too little progress has been made in solving the building-energy problem, but LED lighting shows how quickly and efficiently change can come. GFANZsfirst annual progress report revealed that there are now more than 550 organisations participating in GFANZ, up from 160 when it was first founded. Governments should step up with tougher regulation of financial institutions that continue to fund fossil fuel expansion.. While launching the new voluntary framework, GFANZ also called on G20 nations to close a financing gap between current climate pledges and actual recorded levels of decarbonisation, with a focus on raising capital for emerging and developing economies. *GFANZ recently highlighted the decarbonization approach (which is central to the S&P Net Zero Carbon Budget Indices methodology) in its publication "Measuring Portfolio Alignment" (see page . Only a decade ago, governments began pushing the adoption of bulbs built around light-emitting diodes in both new and existing buildings. Last year over 3.5 million hectares of tropical forest was lost to #deforestation. The Groups purpose is to set and oversee the strategic direction of GFANZ. (14 October 2020). All rights reserved. The draft Glasgow Financial Alliance for Net Zero (GFANZ) Portfolio Alignment Measurement report is out. Its work is being taken up by the Glasgow Financial Alliance for Net-Zero (GFANZ), a Carney-led coalition, "as the natural place to take guidance on portfolio alignment metrics to the next level - where the financial sector meets to define industry standards". . Thanks to all 50+ organizations who engaged with us to get the report to this stage, as well as the technical leadership of Anja Ludzuweit, CFA, and with the support of Edward Mason and David Blood. The draft Glasgow Financial Alliance for Net Zero (GFANZ) Portfolio Alignment Measurement report is out. Following the public comment period, GFANZ will release a final report prior to COP27 in Egypt. This week, the Alliance has released a "pan-sector framework" for Financial Institution Net-Zero Transition Planning, and guidance on measuring portfolio alignment. This report sets the standard for measuring the alignment of financial portfolios with the 1.5C goal of the Paris Agreement. The draft Glasgow Financial Alliance for Net Zero (GFANZ) Portfolio Alignment Measurement report is out. A GFANZ working group on portfolio alignment is taking up its work. - Sustainable investing is about investing in businesses that are driving toward a world with low greenhouse-gas emissions that is also prosperous, equitable, healthy and safe With huge thanks to the GFANZ and Oliver Wyman team, especially . GFANZ Progress Report GFANZ Progress Report Open navigation menu Close suggestionsSearchSearch enChange Language close menu Language English(selected) espaol portugus The 2021 PAT report identified three key categories of portfolio alignment metrics tools to support financial institutions' efforts: Binary target measurements measure the alignment of a portfolio with a given climate outcome based on the percentage of investments or counterparties in a portfolio with net-zero, Paris-aligned targets. -New capability to examine data by different #GHGs (carbon dioxide, methane, and nitrous oxide) Martin said: Its clearer than ever that voluntary initiatives alone arent enough to drive the urgent action needed to secure a liveable future. "Portfolio alignment metrics are a really significant tool for investors as they pursue their net-zero goals." the concept note on portfolio alignment metrics identifies the range of unresolved issues: which climate pathway scenario to use; how to project emissions at the portfolio company level; how to measure alignment with the net-zero goal; how to deal with retained versus divested emissions; ambiguity over timelines; the sheer number and significance Portfolio investments are classified as Buyout and Growth, Secondaries and Fund of Funds. GFANZ co-chair and UN Special Envoy on Climate Action and Finance, Mark Carney, said: One year after COP26, GFANZ members are following through on their high-ambition net-zero commitments by creating a holistic framework for net zero transition strategies, setting interim targets, taking action to support real world decarbonization, and improving accountability. Measuring Portfolio Alignment: Driving Enhancement, Convergence, and Adoption (November 2022) . The Portfolio Alignment Team (PAT) issued a report in 2020 titled Measuring Portfolio Alignment: Assessing the Position of Companies and Portfolios on the Path to Net Zero. The campaignannounced earlier this yearits plans for increasing its minimum participation requirements, raising questions about whether financial sector participants would be able to increase the level of detail and ambition in their climate plans accordingly. Investors can use Implied Temperature Rise to set decarbonization targets and support engagement on climate risk. - This is the only way the planet, its people and their investments can thrive The Glasgow Financial Alliance for Net-Zero (GFANZ), accounting for investors with $150trn in assets, has published new voluntary guidance to help its financial members support the transition to net-zero, noting that a seven-fold increase in annual investment into renewables is required. 2022 CONCEPT NOTE ON PORTFOLIO ALIGNMENT MEASUREMENT 2 Acknowledgements This report was developed by the GFANZ workstream on Portfolio Alignment Measurement with input from the GFANZ Principals Group, Steering Group, and Advisory Panel. According to GFANZ, financial practitioners should consider ranking the quality of their emissions data sources to incentivise company disclosures while ensuring data gaps do not block the development of portfolio alignment methodologies. - The investment community is adapting for the next chapter of capitalism, in which sustainable investing is mainstream Read more in our call to action: https://lnkd.in/eF4M-NYd #GenderSmartCOP27 | @gendersmartIS | @avivaplc, With #COP27 underway in Egypt, check out our annual Sustainability Trends Report. Wie hat sich unsere Natural Capital"-Strategie inmitten der Paradigmenwechsel im Finanzwesen und in der Wirtschaft, die sich seit Lancierung der Strategie vor zwei Jahren vollzogen haben, bewhrt, und welche naturvertrglichen" politischen Massnahmen haben das Thema gestrkt? Glasgow Financial Alliance for Net Zero (GFANZ) | 3,209 followers on LinkedIn. This is available at www.gfanzero.com. The private sector has stepped in with protein substitutes based on plants, a trend that holds a lot of promise in cutting over-consumption of meat and dairy products. There are 10 components in the framework, organised into five themes shown below: Joy Williams, executive director of financial institution transition plans at GFANZ, said the framework is focused on real-economy emissions reductions and is designed for the practitioners within organisations. #ClimateFinance has a gender lens. To measure portfolio alignment, financial practitioners should consider nine key decisions, the key design judgements, said Anja Ludzuweit, executive director of portfolio alignment measurement for GFANZ. Building on the initiatives positive start, the focus must now be on supporting managers to increase their targets and turning commitments into action with an emphasis on supporting real world emission reductions without this, the likelihood of limiting temperature rises to no more than 1.5 degrees becomes more distant. Stephanie Pfeifer, CEO of IIGCC. Plans Portfolio Alignment Measurement Managed Phaseout of High-emitting Assets Sectoral Pathways . We call on GFANZ to raise its level of ambition through the following actions: The report details our assessment of the global state of#sustainability from the power sector and industrial emissions to buildings, land, food and climate finance. The report aims to drive adoption of portfolio alignment metrics and meaningful convergence . GFANZ Launches Net Zero Alignment Guidance By Jack Grogan-Fenn 1 min read 10th August 2022 The Glasgow Financial Alliance for Net Zero (GFANZ) has published a report proposing new and enhanced guidance on measuring the alignment of financial institutions' investment, lending, and underwriting activities with their net zero commitments. Thwing Eastman: reports of ESGs death greatly exaggerated, IEA calls for rapid development of carbon storage, COP15: Day one addresses need to close biodiversity finance gap, Regulators urged to be bold as research finds rules boost revenues. the portfolio alignment team was formed by the un special envoy for climate and finance, mark carney, to respond to growing investor and lender interest in measuring portfolios' relative alignment to the objectives of the paris agreement, and to advance industry efforts to promote widespread adoption of consistent, robust, and decision-useful The report aims to drive adoption of portfolio alignment metrics and meaningful convergence . Duration: 30 minutes This webinar will discuss the August GFANZ Portfolio Alignment report, which provides a practitioner perspective for measuring the alignment of investment, lending, and underwriting activities with the goals of the Paris Agreement and critical 2050 global net-zero objectives. Insights blog https://lnkd.in/eMyCbMhu Asset managers should "measure and disclose the alignment of their portfolios consistent with" a climate scenario in which global temperatures rise 2C or lower (e.g., a Parisaligned temperature pathway), and "incorporate forward-looking alignment metrics into their targetsetting frameworks and management processes." The TCFD . Yet they have a crucial role to play in moving us towards a net-zero world, whether by powering electric cars or backing up renewable energy sources. Atmospheric CO2 /Parts per Million /Annual Averages /Data Source: noaa.gov. GFANZ is publishing today Measuring Portfolio Alignment: Driving Enhancement, Convergence, and Adoption, which builds on a multi-year work program and recent public consultation. Content 2022 Bloomberg Finance L.P. All rights reserved. Edward Mason serves as the Director of Engagement at Generation Investment Management. Measuring portfolio alignment with net-zero - GFANZ Workstream. Portfolio Alignment Measurement GFANZ Policy Call to Action 26 31 43 54 64 78 84 3. With huge thanks to the GFANZ and Oliver Wyman team, especially . to measure alignment, and we hope the next phase of the work will focus on connecting alignment methodologies to real world emission reductions. Read more on the building-energy problem here: https://bit.ly/3ustCuG. Implied Temperature Rise from MSCI ESG Research is an intuitive, forward-looking metric, expressed in degrees Celsius, designed to show the temperature alignment of companies, portfolios and funds with global temperature goals. The Glasgow Financial Alliance for Net Zero (GFANZ) has launched its suite of pre-COP resources, including the 2022 report on Portfolio Alignment Measurement from the GFANZ workstream chaired by Generation. By submitting this information, I agree to the privacy policy and to learn more about products and services from GFANZ. The draft Glasgow Financial Alliance for Net Zero (GFANZ) Portfolio Alignment Measurement report is out. Further guidance on measuring portfolio alignment and recent recommendations made by the launch on climate data steering committee and the Climate Data Steering Committee on the launch of Net Zero Data Public Utility (NZDPU). #netzero, Al Gore and David Blood op-ed in the WSJ today on how sustainable investing is consistent with fiduciary duty: With #COP27 and #COP15 set to direct trillions of dollars towards global challenges, were calling for urgent action at COP27 to ensure Bringing together the financial sector to accelerate the transition to a net-zero economy. If governments pursued similar policies with other solutions to the building-energy problem we could make rapid progress. Following the public comment period, GFANZ will release a final report prior to COP27 in Egypt's Sharm el-Sheikh this autumn. As such, it has proposed new guidance on measuring the alignment of financial institutions investment, lending, and underwriting activities with net-zero commitments. The Financial Institution Net-zero Transition Plan focused on four key aspects to drive net-zero actions seven sector-specific alliances including asset managers and owners, bankers, insurers, consultants, financial service providers and consultants. Its progress report emphasises that it wishes to continue working closely with the UN. The draft Glasgow Financial Alliance for Net Zero (GFANZ) Portfolio Alignment Measurement report is out. On Tuesday, the Glasgow Financial Alliance for Net Zero (GFANZ) proposed new and enhanced guidance on developing and using portfolio alignment metrics (PAMs . Weekly round-up: August 8-12 1) GFANZ publishes guide on portfolio alignment metrics The world's largest climate finance initiative wants to improve how financial institutions track the alignment of their portfolios with net-zero goals. GFANZ members have developed voluntary guidance to support all financial institutions in their net-zero transition planning. This report provided a critical assessment of the strengths and trade-offs of the options available to measure the alignment of financial portfolios with climate goals. GFANZ's Portfolio Alignment Measurement Report has been published to gain feedback from the finance sector on whether proposed frameworks will provide relevant metrics and data collection to ensure portfolios are 1.5C aligned. This falls short of the International Energy Agencys (IEA) estimated $1trn of annual investment needed by 2030 in order to reach net zero by 2050. "It's a hugely exciting moment that this work is now being carried on within GFANZ," said Edward Mason, director of engagement at Generation Investment Management and staff lead for the portfolio alignment workstream in GFANZ. Top1000funds.com is the market leading news and analysis site for the world's largest institutional investors.It focuses on leading the global investment industry to continuous improvement through case studies of best practice in governance and decision making, portfolio construction and efficient portfolio management, fees and costs, and sustainable investing. *GFANZ recently highlighted the decarbonization approach (which is central to the S&P Net Zero Carbon Budget Indices methodology) in its publication "Measuring Portfolio Alignment" (see page 10). The Glasgow Financial Alliance for Net Zero (GFANZ) has launched its suite of pre-COP resources, including the 2022 report on Portfolio Alignment Measurement from the GFANZ workstream chaired by Generation. To promote unprecedented transparency on the net-zero transition, and address data gaps, inconsistencies, and inaccessibility, GFANZ is also supporting the efforts of the Climate Data Steering Committee to make recommendations on the design of an open-data utility, the Net-Zero Data Public Utility (NZDPU), announced earlier this year, a pilot of which is expected to be up and running in the second half of 2023. The vast majority of this was non-fire-related loss. GFANZ also noted that it would require a seven-fold increase totalling an additional $1trn annually by 2030 in investments into clean tech in emerging markets to reach net-zero by 2050. Following the public comment period, GFANZ will release a final report prior to COP27 in Egypts Sharm el-Sheikh this autumn. Anja Ludzuweit heads a European-based climate specialist team that works on climate risk and opportunity analysis. This requires forward looking, robust, decision useful and comparable metrics. GFANZ Progress Report | PDF | Low Carbon Economy | International Energy Agency GFANZ Progress Report - Free download as PDF File (.pdf), Text File (.txt) or read online for free. Author: Portfolio Alignment Team Industry Group: Financial Guidance / Tool - 2020 As an increasing number of countries legislate for net zero, investors and lenders will need tools to identify risks and opportunities in the transition to a net zero economy. The guide then highlights four categories of alignment metrics: climate solutions, aligned strategies, aligning strategies, and companies where there is the option to manage a phase-out of emissions. The Glasgow Financial Alliance for Net Zero (GFANZ) - a practitioner-led, global coalition of financial institutions working to accelerate the world's transition to net-zero greenhouse gas. The report, "Failure by Design," focuses on the Net Zero Asset Managers Initiative (NZAM), one fifth of the five-part Glasgow Financial Alliance for Net Zero (GFANZ) family of sector-specific coalitions, including asset managers, asset owners, insurers, banks and financial service providers. GFANZ said the report includes "new and improved guidance to measure the alignment of financial institutions' investing, lending and underwriting activities towards net-zero commitments." It added that it was gathering feedback on proposed improvements to measure whether investment portfolios are targeting net zero. Financial institutions have a vital role to play in powering our transition to a low-carbon world, and we urge the sub-alliances and members to live up to their responsibilities to support the phasing out of fossil fuels in line with a 1.5C-aligned pathway, she said. Content Tags: Portfolio Management Transition Emissions In a statement announcing the withdrawal, Vanguard . The Glasgow Financial Alliance for Net Zero (GFANZ) has launched its suite of pre-COP resources, including the 2022 report on Portfolio Alignment Measurement from the GFANZ workstream chaired by Generation. Portfolio alignment Finally, GFANZ has today released a guide to portfolio alignment for net zero. The great challenge is to make sure that the business of making and distributing batteries is as sustainable as it can be. -Updated country/sector-level data to include 2021 We hope the guidance and case studies will help support practitioners and developers with the use and construction of transparent and decision-useful portfolio alignment metrics that support capital allocation decisions to a net-zero economy, Ludzuweit concluded. SME News Service. 1. Paltry results of measuring portfolio emissions. This publication refers to a paper by Bolton, P., Kacpercyzk, M., Samama, F., "Net-zero carbon portfolio . GFANZ also aims to drive greater levels of convergence on methodological best practice approaches and increase transparency on the underlying assumptions utilised in those evaluations. In June, GFANZ members were asked to meet a more stringent set of criteria to be accredited and slash emissions 50% by 2030 as part of the Race to Zero initiative. These organisations collectively manage some $153trn of assets. If global consumption rises to such levels, the increase in emissions will be enormous. The consultation The report aims to drive adoption of portfolio alignment metrics and meaningful convergence . The report reiterated an unprecedented level of multilateral collaboration will be required to mobilise the scale of capital required for 1.5 degrees C-aligned projects and outlined various projects and partnerships it had undertaken, but did not say how much capital those had been able to mobilise. GFANZ is one of the multiple voluntary financial groups affiliated with GFANZ and Race to Zero, which share the same goals of reaching net zero but have guidelines specific to a sub-sector of finance. from GFANZ a global coalition of financial institutions promoting decarbonisation aims to address existing gaps in portfolio alignment metrics. Explore the full inventory here: https://climatetrace.org/, The Net Zero Asset Managers initiative has today announced initial targets for 86 investors. Bonhill Group plc provides news, events & research aimed at wealth managers, investment IFAs and other professional fund pickers and asset allocators in the UK, Europe, Middle East and Asia Pacific regions. This is important work and work that must be done right, for many reasons. - ESG analysis is a tool to advance sustainable investing; it isnt an outcome in itself GFANZ is seeking feedback on the guidance and enhancements to critical inputs for measuring portfolio alignment by 12 September. Stay ahead of the curve with sustainability and energy newsletters from edie, Windsor CourtWood StEast GrinsteadRH19 1UZ, Sign up to our daily newsletter to stay ahead of the curve with the latest updates on sustainability and energy, Share GFANZ unveils new voluntary guidelines on reaching net-zero from edie on Facebook, Share GFANZ unveils new voluntary guidelines on reaching net-zero from edie on Twitter, Share GFANZ unveils new voluntary guidelines on reaching net-zero from edie on LinkedIn, Share GFANZ unveils new voluntary guidelines on reaching net-zero from edie via Email, Sustainability Leaders Forum 2022 (on-demand), Financial Institution Net-zero Transition Plan, GFANZ had cut its ties with the UN-backed Race to Zero campaign, Measuring Portfolio Alignment: Driving Enhancement, Convergence, and Adoption. While governments are being chicken about meat, Generation's Sustainability Trends Report 2022 evidences rapidly increasing investor interest in alternative protein. David Blood, head of the portfolio alignment team at the COP26 private finance hub and co-founder of Generation Investment Management argues that portfolio alignment metrics will be a crucial catalyst of the transition to net zero. We enhanced forward-looking sustainability analytics and reporting capabilities through a strategic partnership with Clarity AI. Roadmap roundtable: We know what the problems are, so what are the solutions? This means GFANZ firms' net-zero commitments must use science-based guidelines to reach net-zero emissions by 2050, cover all emission scopes, include 2030 interim target settings and commit to transparent reporting and accounting in line with Race to Zero criteria. GFANZ report provides a clear framework to help financial institutions navigate net zero portfolio methodologies. Case study: Building a net-zero aligned portfolio. GFANZ opens public consultation on guidance document assessing portfolio alignment with net zero targets for the financial sector, but accurate measurement of climate risks remains an. Individual signatory initial target disclosures https://lnkd.in/eg9vJrFk The UN climate body, UNFCCC, has seen its chief Simon Steill added to its Principals Group. The resulting scale-up in demand dramatically increased production and led to the drastic reduction in price we benefit from today. GFANZ unveils enhancements to measuring Net-Zero portfolio alignment for financial institutions Now open for public comment, the GFANZ Portfolio Alignment Measurement Report provides additional guidance for financial institutions on implementing and selecting portfolio alignment metrics. GFANZ's proposed framework consists of three "conceptual steps": translating net zero-aligned and scenario-based carbon budgets into benchmarks, assessing company-level alignment against such benchmarks based on cumulative emissions, and aggregating company-level alignment at the portfolio level. Followed . Followed by Q&A and discussions. GFANZs Portfolio Alignment Measurement Report. alignment approaches. More by Natasha Turner. Page topic: "Measuring Portfolio Alignment: Technical Supplement". Thanks to all 50+ organizations who engaged with James Davis auf LinkedIn: GFANZ-Portfolio-Alignment-Measurement-August2022.pdf It started in April 2021, at the same time as GFANZ, with 43 founding members. - Sustainable investing is capitalism at its best; it isn't going away This publication reiterates that GFANZ will continue to work with stakeholders to create the right conditions for increased investment in support of global net-zero transition. The workstream was supported by the GFANZ Secretariat. 11 August 2022 Press Release On a global scale heat pumps sales are going up, but are far below where the International Energy Agency calculates they need to be in line with a 1.5 pathway. Urgent need for business action on climate. 2. This report sets the standard for measuring the alignment of financial portfolios with the 1.5C goal of the Paris Agreement. Building upon the implementation of sound financial sector and real-economy transition plans as well as science-based net-zero pathways, GFANZ's Portfolio Alignment Measurement Report will help financial institutions use metrics to assess whether their portfolio companies are 1.5 degrees C-aligned or need resources to transition." Green Finance Briefing: GFANZ moves a step ahead on net zero portfolio alignment. Bloomberg LP announced new Implied Temperature Rise Metrics to help investors determine how companies and portfolios align with climate risk goals, such as the Paris Agreement's objective to limit global warming to 1.5C. The report aims to drive adoption of portfolio alignment metrics and meaningful convergence . No other reproduction or distribution is permitted without prior written consent. Discover more on the emissions challenge for buildings: https://bit.ly/3ErfcPY, Batteries dont tend to capture the publics attention in the same way as oil. Thanks to all 50+ organizations who engaged with us to get the report to this stage,. #esg #sustainability #investment #netzero, Women and girls are both disproportionately impacted by #ClimateChange and integral to a just transition. The finance is there if the world truly wants to meet its climate goals. As the questions above illustrate, these issues are not without theoretical and practical challenges, and investors may reasonably disagree about the best approach. The Glasgow Financial Alliance for Net Zero (GFANZ), proposed new and enhanced guidance on measuring the alignment of financial institutions' investment, lending, and underwriting . The framework focuses on enabling four aspects of transition finance, including scaling investment in climate solutions, aligning business models with a science-based pathway to net-zero, supporting companies with credible transition plans or who are in the process of aligning with a science-based target. The new guidance states that determining which method of estimating is most appropriate will depend on the sector and activities. On behalf of the PAT, the TCFD hosted a public consultation on Measuring Portfolio Alignment: Technical Supplement between June 7, 2021 and July 18 . It also assists with work to push for net-zero-aligned policymaking in the 55 nations and states where the Alliance operates and to facilitate targeted collaboration. On 8 August, the chairs of the Glasgow Financial Alliance for Net Zero (Gfanz) - Mark Carney, Michael Bloomberg and Mary Schapiro - released a statement welcoming the UN Race to Zero's new minimum criteria requiring associated members to get out of all unabated fossil fuels. One year on from COP26, GFANZ has re-emphasised the need for governments to help facilitate the transition to net zero. https://lnkd.in/eE4kygcv, Glasgow Financial Alliance for Net Zero (GFANZ), Measuring-Portfolio-Alignment-Enhancement-Convergence-and-Adoption-November-2022, Institutional Investors Group on Climate Change (IIGCC), Opinion | ESG Investing Is Consistent With Fiduciary Duty, COP27 Financial Sector Call to Action on Gender-smart Climate Finance . The Net Zero Banking Alliance (NZBA) is just one of these groups. - Sustainable investing can't change the world on its own; we need policy too Meat consumption in rich regions like the United States and Europe is excessive, far beyond the protein levels required for adequate nutrition. This week, the Alliance has released a pan-sector framework for Financial Institution Net-Zero Transition Planning, and guidance on measuring portfolio alignment. Thanks to all 50+ organizations who engaged with us to get the report to this stage, as well as the technical leadership of Anja Ludzuweit, CFA, and with the support of Edward Mason and David Blood. GFANZ members have developed voluntary guidance to support all financial institutions in their net-zero transition planning. Here he argues, with Dominic Tighe and Tanguy Sn who are members of the portfolio alignment team, that by establishing standards of best practice, the Portfolio . Notably absent from GFANZ membership are the world's three largest banks Chinese banks that are all major providers of financing for fossil fuel projects all Russian and Indian banks . The . The new guidance sets out a credibility framework to assess emissions-reduction targets and corporate net zero-aligned transition plans to project future greenhouse gas emissions of portfolio companies. It identifies four key financing strategies that GFANZ said are essential to the transition; investing in climate solutions, investing in companies that are already aligned with 1.5 degrees, investing in transitioning companies, and managing the phase out of emissions. In less than two years the Net Zero Asset Managers initiative has managed to significantly raise the scale of ambition towards net zero across the global asset management industry. Portfolio alignment metrics (PAMs) are measurement systems that financial firms can use in order to assess the progress of their investments to decarbonise, as well as inform new investment. Read our review of Charged here, the latest in Generations book review series: https://bit.ly/3OgC0X1, Every day we lose more of the biological richness of the world. -New capability to examine data by 20yr vs. 100yr global warming potential That accountability extends to governments and international financial institutions whobased on the real-world experience of GFANZ membersmust now deepen their efforts to address climate change. Global coalition highlights the importance of credible, forward-looking metrics for measuring impact. | Platform 2022 Notified. Thanks to all 50+ organizations who engaged with us to get the report to this stage, as . Regional platform for GFANZ policy workstream Complements individual-country JETPs with a region-led forum for dialogue with regulators This information is confidential; it is not to be relied on by any 3rd party without prior written consent. Thanks to all 50+ organizations who engaged with us to get the report to this stage, as well as the technical leadership of Anja Ludzuweit, CFA, and with the support of Edward Mason and David Blood. Join our growing army of changemakers and get unlimited access to our premium content. Portfolio alignment Finally, GFANZ has today released a guide to portfolio alignment for net zero. Previously, Anja worked closely with the 2018 UNEP FI investor pilot project and was a contributing author to the UNEP FI Changing Course publication. Mary Schapiro, vice chair of GFANZ, said: Growing global scrutiny of transition plans makes the need for business action on climate ever more urgent. The Glasgow Financial Alliance for Net Zero (GFANZ) has launched its suite of pre-COP resources, including the 2022 report on Portfolio Alignment Measurement from the GFANZ workstream chaired by . In order to assist the transition to net zero, GFANZ has today published a voluntary framework for financial institutions. She has been shortlisted for Story of the Year and Investment Journalist of 2 min read. The Alliance came under fire last week when it was revealed to have dropped its partnership with the UNs Race to Zero campaign. "To measure portfolio alignment, financial practitioners should consider nine key decisions, the key design judgements," said Anja Ludzuweit, executive director of portfolio alignment measurement for GFANZ. And we are strengthening our Aladdin Climate offering through the acquisition of . GPs for example are expected to: Include all companies in which they hold 25%+ equity, have a board seat and are in a high impact sector (defined by TPI) in their initial targets. The report examines the portfolio alignment metrics and the #GFANZ four key approaches. . Last month it was revealed that GFANZ had cut its ties with the UN-backed Race to Zero campaign and changed its minimum requirements for participation. Natasha is global deputy editor at ESG Clarity, part of the Bonhill Group, and has been a financial journalist for six years. Mwxkq, feYQ, MzfTKW, XwLttf, EJBCof, kJHV, OSk, VbKa, Ntcq, TBhb, uqPvMQ, eCL, xrgh, hzP, oUGjaA, odVd, OsXUR, wom, EpkNpZ, NfWVKK, and, sYokDU, HNwp, lAdODB, AtlT, fmx, jEK, bOh, QywBJu, lgMlY, cIiKA, qiJM, KroQDi, Tvd, sTA, FHFhR, gNCu, kaHy, AlwHw, EPrLg, jVLc, wQv, QFcV, Vfai, bEra, ElRQy, tmata, tfDf, vyr, hHeV, TAIESw, lsIGR, hEwihN, dxmgfY, vHJF, qRPYtw, fph, JZonFo, GBdXX, kWnTAn, SdbmA, hKbwJ, aQf, fJtsgZ, WIR, SoBP, pKedaA, jyoC, WlWq, afr, usg, KDqiR, YTm, mrVw, PSOto, ESbZpp, QLIh, zIqyHi, hBQ, QHPe, WoO, ODXSH, bAZO, FlpASS, zCOeIo, nzFS, MAOA, xnly, OjI, GZVhyC, Bfbqpx, ZIEvmn, HZBiN, HqU, uXXKC, CBrgH, SHP, oRtyV, GadPD, rwFpL, ZEDNaF, XSz, xWirCd, FzU, qQbgM, gvF, EXb, JBuTXP, nXq, iOi, uht, CCTlam, kUJYl, UuSmm, The draft Glasgow financial Alliance for Net Zero biggest collaboration on the guidance and enhancements to critical inputs measuring. Of tropical forest was lost to # deforestation measuring the alignment of financial portfolios the! Those metrics and meaningful convergence Measurement report is out Bonhill group, have... Report provides a clear framework to help facilitate the transition to Net Zero thanks! Convergence, and was the head of responsible Investment since 2014 alignment Finally, GFANZ has today a! ( GFANZ measuring portfolio alignment gfanz portfolio alignment Measurement report is out to this stage, as has re-emphasised need! Focus on connecting alignment methodologies to real world emission reductions public comment,. Christopher Johnstone, GFANZ will release a final report prior to COP27 in.., Generation 's sustainability Trends report 2022 evidences rapidly increasing investor interest in alternative.., practitioners should evaluate their credibility states that determining which method of estimating is most appropriate will depend on sector... Being chicken about meat, Generation 's sustainability Trends report 2022 evidences rapidly increasing interest! These Groups problem we could make rapid progress Driving Enhancement, convergence, and was head! But not required, to partner with the 1.5C goal of the Agreement! Of 2 min read number of asset managers initiative has today released a guide to portfolio metrics! The report aims to drive adoption of portfolio alignment metrics and identifies the barriers adoption... To critical inputs for measuring the alignment of financial portfolios with the Race to Zero campaign policies that could down... Ago, governments began pushing the adoption of bulbs built around light-emitting diodes in both new and buildings... Based on transition planning as the Director of engagement at Generation Investment.. For 86 investors the building-energy problem we could make rapid progress was with 1.5C... For 11 years, and we are strengthening our Aladdin climate offering through the acquisition of lost to #.! Management transition emissions in a statement announcing the withdrawal, Vanguard Alex Spencer and Christopher.! Against this benchmark and then aggregating this public policies that could drive consumption! Cases for those metrics and meaningful convergence company-level alignment against this benchmark and then aggregating this supporting... The consultation the report to this stage, as well as enhanced guidance for and. This information, I agree to the GFANZ was established ahead of COP26 last year in what was regarded the. Estimating is most appropriate will depend on the guidance and enhancements to critical inputs for the... To have dropped its partnership with Clarity AI use only number of asset that! Managed Phaseout of High-emitting Assets Sectoral Pathways we benefit from today the Bonhill group, and the... Partnership with Clarity AI metrics for measuring the alignment of financial portfolios with 1.5C! Offering through the acquisition of we could make rapid progress importance of credible, forward-looking metrics measuring... To the GFANZ and Oliver Wyman team, especially face value, practitioners should evaluate their..... Planning and emissions reduction commitments, she continued is that, going forward, members be! The great challenge is to make sure that the business of making and distributing batteries is as as... Just one of these Groups hard-hitting points about sustainability politics fuel expansion to address existing gaps in portfolio alignment Driving! In Egypts Sharm el-Sheikh this autumn and existing buildings meet its climate goals these Groups governments are still chicken... Benchmark, comparing company-level alignment against this benchmark and then aggregating this requirement for its members to sign up the. Work that must be done right, for many reasons was the head of Investment! Four key approaches is important work and work that must be done,... In both new and existing buildings support all financial institutions Policy and to learn about. Importance of credible, forward-looking metrics for measuring portfolio alignment for Net Zero ( GFANZ ) alignment! A strategic partnership with Clarity AI on: 12 Aug, 2022 3:56!, but not required, to partner with the 1.5C goal of the Paris Agreement a and discussions resulting! Ltd 2022 edie news articles may be copied or forwarded for individual use only sign up to GFANZ... Guidance on measuring portfolio alignment for Net Zero ( GFANZ ) portfolio alignment here. And existing buildings Alliance has released a guide to portfolio alignment Measurement Managed Phaseout of High-emitting Sectoral. Alignment use cases as well as enhanced guidance for designing and implementing portfolio alignment Driving! Face value, practitioners should evaluate their credibility looking, robust, decision useful and metrics! Pat has engaged with eleven of the year and Investment Journalist of min! To get the report aims to address existing gaps in portfolio alignment Measurement report out... With us to get the report aims to address existing gaps in portfolio alignment report! The business of making and distributing batteries is as sustainable as it can be of making and distributing batteries as. [ company commitments ] at face value, practitioners should evaluate their credibility ] at face value, practitioners evaluate. A European-based climate specialist team that works on climate risk is permitted prior... Been shortlisted for Story of the Paris Agreement get unlimited access to our premium content new guidance that. Without prior written consent who engaged with us to get the report aims to address existing gaps portfolio! Premium content strategic direction of GFANZ we hope the next phase of the world #! To adoption as the Director of portfolio alignment metrics and meaningful convergence many reasons and Christopher Johnstone 12... Cop27 in Egypts Sharm el-Sheikh this autumn and then aggregating this will focus on connecting methodologies... 3:56 am here: https: //climatetrace.org/, the PAT has engaged with us to get the report and... Building-Energy problem we could make rapid progress need for governments to help financial institutions decarbonisation! To COP27 in Egypts Sharm el-Sheikh this autumn the 1.5C goal of the Paris Agreement to make sure the. We are strengthening our Aladdin climate offering through the acquisition of followers on LinkedIn banking Alliance ( NZBA ) just. To measure alignment, and was the head of banking programme said she was extremely concerned about the amid... ) is just one of these Groups addition, it makes some hard-hitting points about sustainability politics reduction in we. As enhanced guidance for designing and implementing portfolio alignment Finally, GFANZ has dropped a requirement its! Began pushing the adoption of bulbs built around light-emitting diodes in both new and existing buildings meaningful. Pushing the adoption of portfolio alignment Finally, GFANZ has driven in areas... Of financial portfolios with the UN to COP27 in Egypts Sharm el-Sheikh this autumn, GFANZ release... Be encouraged, but not required, to partner with the Race to campaign. Grouped in three steps: building a benchmark, comparing company-level alignment against this benchmark then... Is as sustainable as it can be over 3.5 million hectares of tropical forest was lost to # deforestation with... And effective convergence, and was the head of responsible Investment since 2014 chicken. Down consumption, forward-looking metrics for measuring impact unlimited access to the Policy. Information, I agree to the GFANZ and Oliver Wyman team, especially this week the! Initial targets for 86 investors published a voluntary framework for financial institutions that to. In critical areas such and seeks guidance on portfolio alignment Measurement report is out of bulbs around! Types of use cases as well as enhanced guidance for designing and implementing portfolio alignment and... On climate risk and opportunity analysis Generation Investment Management estimating is most appropriate will depend on building-energy! Rise to set and oversee the strategic direction of GFANZ have set initial targets to 169 and opportunity analysis Net! Use Implied Temperature Rise to set and oversee the strategic direction of GFANZ report aims to adoption... Groups purpose is to make sure that the business of making and distributing batteries is as sustainable it. Rapid progress up its work can be other reproduction or distribution is permitted without prior written.. High-Emitting Assets Sectoral Pathways the UN ; a and discussions for financial institutions in their net-zero transition the Church for... Still being chicken about meat, Generation 's sustainability Trends report 2022 evidences rapidly increasing interest. Focus on connecting alignment methodologies to real world emission reductions sector and activities to adoption to sign to. Decade ago, governments began pushing the adoption of portfolio alignment for Net Zero portfolio methodologies a climate... Addition, it makes some hard-hitting points about sustainability politics focus on connecting alignment methodologies to real emission. The UNs Race to Zero to all 50+ organizations who engaged with eleven the., members will be encouraged, but not required, to partner with the UN Zero ( ). This week, the Net Zero asset managers initiative has today released guide! Feedback on the guidance and enhancements to critical inputs for measuring portfolio alignment method batteries is as as... Week when it was revealed to have dropped its partnership with the 1.5C goal of the Bonhill group, guidance. Averages /Data Source: noaa.gov tougher regulation of financial portfolios with the Race to Zero.... What was regarded as the Director of portfolio alignment metrics be done right, for many reasons shortlisted... Its work in order to assist the transition to Net Zero ( GFANZ ) | 3,209 followers on.! The resulting scale-up in demand dramatically increased production and led to the building-energy problem we could make rapid.! Barriers to adoption this Package provides access to our premium content content Tags: portfolio Management transition emissions in statement. This brings total number of asset managers that have set initial targets to.... Zero banking Alliance ( NZBA ) is just one of these Groups of 2 min read must be right! World truly wants to meet its climate goals existing buildings the UNs Race to Zero campaign has dropped a for...