Earth Day brings tidings of climate change commitments

Timed to commemorate Earth Day 2021, FS Sustainability has received a plethora of announcements and commitments from investors, businesses and beloved consumer goods pledging action on climate change.

To name and annotate each organisation making a pledge towards managing or mitigating climate change would give cause for much scrolling down this page - and think of the electricity consumed to do so. In lieu, FS Sustainability offers some highlights of what institutions are saying on Earth Day, which coincides with a two-day Leaders Summit on Climate convened by US President Joe Biden.

An additional 14 asset managers, including State Street Global Advisors (SSGA), have joined the Net Zero Asset Managers initiative, bringing the total number of signatories up to 87 managers with nearly $37 trillion in AUM.

"We are especially keen to leverage our position as one of the world's largest asset managers to raise awareness of the systemic risks associated with climate change, and to help all stakeholders navigate the difficult choices we face as we effectively manage the transition risks," says Cyrus Taraporevala, president and chief executive officer, SSGA, said. "The goal of net-zero-carbon emissions by 2050 is consistent with our commitment to drive long-term value on behalf of our clients."

The new signatories include Alquity Investment Management, BankInvest, Colony Capital, Coutts Asset Management, EcoFin, Insight Investment, Quinbrook Infrastructure Partners, Ridgewood Infrastructure, Russell Investments, Sage Advisory, Trillium Asset Management, Valo Ventures, and Vert Asset Management

The asset manager signatories have committed to set interim targets for 2030, consistent with a fair share of the 50% global reduction in greenhouse gases identified by the Intergovernmental Panel On Climate Change (IPCC) to halt global warming at 1.5C.

Speaking of President Biden's stated goal of bringing US leadership back to the climate change debate, Guillaume Mascotto, head of ESG and Investment Stewardship for American Century Investments, notes that while investing in renewable energy assets in the US will continue, there will not be an abrupt switch away from fossil fuels in the US due continued low natural gas prices, infrastructural obstacles and potential pushback from Republicans in a highly divided Senate.

"We believe the Biden administration's key challenge will be maximizing the incentives to scale advanced and knowledge-intensive renewable energy/closed-loop solutions while balancing social and economic considerations to which the U.S. is currently exposed," Mascotto said.

Turning to company announcements within Australia, supermarket giant Coles has continued working towards its goal of being 100% powered by renewable energy by the end of the 2025 financial year by signing two agreements with renewable energy companies ENGIE and Neoen.

When added to other renewable power purchase agreements, onsite solar and large-scale generation certificate (LGC) deals, Coles has hit 70% of its renewable electricity target, once the agreements commence.

Under the agreements, Coles will purchase LGCs generated from ENGIE and Neoen. LGCs are issued by power stations that generate electricity from renewable energy sources. Each certificate represents one megawatt hour (MWh) of renewable electricity generated. It is a means for businesses to account for the amount of renewable energy generated, and by purchasing an LGC equivalent to consumption, businesses can state that they are powered by renewable energy.

"As part of our ambition to be Australia's most sustainable supermarket we've launched our new 'Together to Zero' sustainability strategy with a long-term aspiration towards zero emissions, zero waste and zero hunger," says Thinus Keeve, Coles chief sustainability, property and export officer. "The agreements are with some of the world's top renewable electricity companies and show we're taking a leading role in driving climate action in Australia.

"It puts us in a great position to be powered by 100% renewable electricity by the end of FY25."

To end on a sweet note, beloved confectionary KitKat will be carbon neutral from 2025.

Manufacturer Nestle says KitKat globally aiming to reduce emissions generated through ingredient sourcing, manufacturing and distribution by more than 50%. Nestle notes that most emissions occur when producing KitKat's ingredients like cocoa and milk, so KitKat will aim to reduce emissions by restoring forests and support a transition to regenerative.

KitKat will invest in high quality offsetting based on natural climate solutions for any emissions that cannot be eliminated.

So even if the chocolate treat isn't calorie-neutral, at least you won't have to worry that your sweet tooth is contributing to worsening climate change. Have a carbon-neutral break. Have a KitKat.

Photo by Fateme Alaie on Unsplash

Read more: KitKatColesEarth DayENGIENeoenGuillaume MascottoNet Zero Asset ManagersCyrus TaraporevalaAmerican Century InvestmentsState Street Global AdvisorsThinus Keeve