LGIM, a prominent asset manager globally, has recently unveiled the outcomes of its seventh Climate Impact Pledge. This initiative, conducted annually, focuses on engaging companies to address climate change and facilitate the transition to net-zero carbon emissions.
Addressing climate risk
LGIM (Legal & General Investment Management) has expanded its Climate Impact Pledge, which aims to hold companies accountable for addressing climate risks. This year, LGIM has assessed over 5,000 companies across 20 climate-critical sectors, a significant increase from the previous year. Through quantitative analysis, LGIM has identified 299 companies that fail to meet its minimum standards for addressing climate risk and qualify for AGM voting sanctions.
In addition to the quantitative assessment, LGIM has engaged with 105 “dial mover” companies, a 75% increase from the previous year. These companies are selected based on their size and potential to drive climate action in their respective sectors. LGIM conducts ongoing engagements with these companies, encouraging change and employing consequences such as voting sanctions and divestments for applicable funds.
Carbon neutrality
Among the dial mover companies, LGIM will apply voting sanctions against 43 of them, including those on the divestment list. LGIM currently has 12 companies on its divestment list, which includes AIG, China Construction Bank, China Resources Cement, Exxon Mobil, Hormel, Industrial Commercial Bank of China, Invitation Homes, KEPCO, Loblaw, MetLife, PPL, and Sysco.
In addition to its previous divestment list, LGIM has added two more companies, Air China and COSCO Shipping Holdings, to its list of companies failing to meet its climate standards, bringing the total to 14. However, there is positive news as China Mengniu Dairy has been reinstated after demonstrating progress. Through direct engagement, the company has published a deforestation policy, committed to achieving carbon neutrality by 2050, and met LGIM’s requirements.
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Source: Legal And General
