Addressing climatic changes solutions
The world is becoming ever more aware of the very real impact climate change and the associated legislation are likely to have on portfolio returns. At Amundi, we’ve developed a number of initiatives to provide our investors with opportunity to participate in the transition to a low carbon economy and/or to mitigate the associated financial risk.
Amundi joins the Montreal Carbon Pledge
By becoming a signatory of the Montréal Carbon Pledge, Amundi is committing to measure and publish the carbon footprint of some of its investment portfolios. Amundi partnered with Trucost, a global leader of carbon data providing, to gain access to precise and exhaustive information about the carbon footprint of its funds (direct and indirect) as well as a robust methodology taking into account every sector’s specificity.
Amundi is already able to disclose the carbon footprint of three of its funds (measured by carbon intensity, defined as tons of CO2 equivalent emitted per million euros of sales).
- Amundi ETF MSCI World Low Carbon UCITS ETF: 275.92 tCO2e.€M-1
- Amundi Index Equity Europe Low Carbon: 262.39 tCO2e.€M-1
- Amundi Index Equity Global Low Carbon: 270.60 tCO2e.€M-1
This commitment is completing Amundi’s years-long action for climate, taking the form of the development of innovative tools to foster climate finance and support for large commitments by investors.
The Montréal Carbon Pledge has been signed by more than 100 institutional investors committed to fight global warming and advocating transparency of information regarding the carbon footprint of their portfolios.
Amundi is also co-founder of the Portfolio Decarbonization Coalition, a global movement of investors whose commitments complement the Montréal Carbon Pledge : members of the PDC commit to decarbonize their portfolios, that is to reduce climate risk thanks to innovative solutions and instruments. By November 2015, members of the PDC had committed to decarbonize $230bn in assets, out of $2.2tn of total assets under management.
Two complementary commitments to foster both transparency and action in favor of climate change mitigation.
Amundi’s initiatives to address climatic changes
With key partners and institutional investors such as AP4, CDP (Central organisation for carbon data) and the United Nations Environment Programme’s financial initiative (UNEP FI), Amundi is involved in a multiparty initiative: the Portfolio Decarbonization Coalition 1.
In parallel, Amundi has developed innovative solutions.
Low Carbon index funds
Partnership with EDF
Each investor is different in terms of requirements and exclusion or selection criteria.
Therefore, we provide investors with tailored ESG and SRI funds that incite issuers to adopt better environmental behaviours, notably in terms of reduction of greenhouse gas issuance. We have identified the most-exposed sectors and we analyse the companies’ capability to monitor their direct and indirect impact on the environment.
Through open-end SRI funds, Amundi’s management also contributes to the limitation of energy consumption, the reduction of greenhouse gas issuance, the fight against commodity exhaustion and the protection of biodiversity.
Low Carbon index solutions
Amundi has developed a full range of index solutions designed for investors seeking to address the financial risk of carbon exposure.
1| Tailored approach
Amundi provides customised solutions aiming at reducing carbon exposure:
- by decarbonizing existing portfolios,
- or by replicating a Low Carbon index meeting the clients’ specific requirements.
2| Innovative index funds
The Low Carbon range comprises two open-ended index fund and an ETF, tracking the MSCI Low Carbon Leaders indexes. The index methodology aims at:
- reducing the carbon footprint efficiently relative to the parent index,
- with a low tracking error and a sectorial and geographical similar composition.
These solutions allow investors to benefit from a potential outperformance of the strategy index once carbon risk is priced while continuing to achieve market performance if not priced.
Amundi committed to responsible financing
of assets under SRI management
of SRI management companies in France2
professionals dedicated to SRI analysis and management
Source: Amundi data and perimeter as at December 31, 2015.
Zoom sur Amundi Valeurs Durables
- Sustainable investing is an investment approach that goes beyond traditional financial analysis to include the analysis of the Environmental, Social, and Governance (ESG) practices of a company.
- Through our open-end Socially Responsible Investment (SRI) funds we help limit the exhaustion of natural reserves, reduce greenhouse gas emissions and protect our biodiversity. The management team focuses on SRI analysis that take into account the ESG aspects of each company. Thus our funds invest in companies with at least 20% of their activity in GreenTech notably within the sectors of energy efficiency, renewable energy, water & waste management sectors. On the other hand, sectors such as alcohol, weaponry, firearms, tobacco, gambling, fossil fuel and nuclear energy are excluded from the universe.
- At Amundi, we understand that each investor is different in terms of requirements and exclusion or selection criteria. Therefore, we provide investors with tailored ESG and SRI solutions that incite issuers to adopt better environmental behaviours, notably in terms of reduction of greenhouse gas issuance. We have identified the most-exposed sectors and we analyse each companies’ capability of monitoring their direct and indirect impact on the environment.
1. The members of this coalition, which aims at mobilising financial markets in the fight against climatic changes, are committed to decarbonize their portfolios for a total amount of USD 100 billion by the climate conference end-2015.
2. In term of assets under management. Besides, 1st asset manager to be certified by the Afnor (French standardisation organisation) for its SRI approach.
This information is exclusively intended for “Professional” investors within the meaning of the MiFID Directive 2004/39/EC of 21 April 2004, and articles 314-4 and following of the General Regulations of the AMF. It is not intended for the general public or for non-professional individual investors within the meaning of all local regulations, or for “US Persons”, as defined in the Securities and Exchange Commission’s “Regulation S” under the 1933 U.S. Securities Act.
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