EdenTree Insight reports
Portfolio climate reporting 2022 27 Oct 2022
ABOUT THIS REPORT
The purpose of this Climate Report is to communicate the results of EdenTree’s 2022 carbon analysis, in line with our Montréal Carbon Pledge commitment. EdenTree became a signatory to the Montréal Carbon Pledge in June 2016, meaning
we are voluntarily committed to measure and disclose the carbon footprint of our investments on an annual basis. We consider risk associated with climate change to have a material impact on our investments and therefore we monitor closely the emissions
of our holdings.
THE URGENCY OF CLIMATE CHANGE
There is scientific consensus that the world is warming, and this is largely due to human activity, with global planetary temperatures already 1.2°C warmer than preindustrial levels. The impacts of this are already evident, with environmental consequences
such as rising sea levels, extreme weather, drought, flooding and ocean acidification, occurring across the world. The latest report from the Intergovernmental Panel on Climate Change (IPCC) indicates that we may reach an increase of 1.5°C as
early as 2030. A temperature rise of 2.0°C would be catastrophic. This is the temperature scientists generally associate with an atmospheric carbon concentration of 450ppm, the level at which the earth reaches its tipping point and climate change
becomes irreversible. The current CO2 concentration is 418ppm.
EDENTREE’S APPROACH TO CLIMATE CHANGE
At EdenTree we fully recognise the role we must play in advancing the low-carbon transition. The urgency of climate change is at the heart of our investment process and forms a central part of our screening process and engagement with companies.
EdenTree’s responsible and sustainable investment process leans positively towards portfolios being carbon aware. Our Responsible & Sustainable Funds have not invested in fossil fuels or mining for many years, we eschew investment in high carbon
emitters (automotive, aviation, heavy industry), direct capital to sustainable solutions, and climate change is a permanent pillar of our engagement strategy.
We have also supported various initiatives over the years:
- We supported the Paris Pledge for Action in 2015 and have regularly supported investor statements to governments calling for ambitious action on climate change
- We have a seven-year track record of carbon footprinting our equity portfolios and in 2021 we also started footprinting our fixed income and balanced portfolios
- We have contributed for six consecutive years to the CDP non-disclosure campaign, asking more businesses to report on climate change
- We have actively been encouraging companies to set Science Based Targets, led by in house engagement, as well as collaborative engagement through the CDP Science Based Target campaign and ShareAction’s Investor Decarbonisation Initiative
- EdenTree publicly supports and is signatory to the TCFD framework
In this report, the data is at 31.12.2021 unless otherwise stated, and where we refer to a benchmark we have used the same benchmark as we use for the measurement of financial performance. We have used the ISS Climate Impact Reporting tool to do our analysis.
The sources for historic carbon footprinting data are ISS (previously SouthPole) and the CDP. Please refer to page 26 for more information about our methodology.
Read full report now