Aviva Investors threaten to ditch top carbon emitters over climate inaction

By Simon Jessop

LONDON (Reuters) - Aviva Investors said on Monday it could ditch its stock and bond holdings in 30 of the world's biggest corporate emitters of carbon if their boards failed to take sufficient action over climate change.

The move comes as asset managers including BlackRock and Legal & General Investment Management look to ratchet up the pressure on companies to form a plan to transition to a lower-carbon economy, ahead of the next round of global climate talks.

The British asset manager, part of insurer Aviva and which manages 355 billion pounds in assets, said its Climate Engagement Escalation Programme would target companies in sectors including oil and gas, mining and utilities.

The programme would last between one and three years, depending on the specifics of the company concerned. Aviva declined to name the companies concerned, but is a big shareholder in leading oil majors including Royal Dutch Shell and BP.

Among the actions Aviva said it expects of the companies are that they commit to net zero carbon emissions by 2050 and ensure their plan to do so is in line with the Science-Based Targets Initiative, an NGO-led group that signs off on corporate climate plans.

The companies would need to integrate the climate goals into their business strategy, including capital expenditure plans; set short- and medium-term targets; align management pay with the goals; and ensure lobbying efforts supported the goals.

"For our engagement approach to have impact, it must be accompanied by a robust escalation process, including the ultimate sanction of divestment," Mirza Baig, Global Head of ESG Research and Stewardship, said in a statement.

Progress would be monitored on a six-month basis, with escalation measures open to Aviva including voting against directors at the companies' annual general meetings, filing shareholder resolutions and working with stakeholder groups to apply pressure, it said.

"This approach has the complete backing of our investment teams," said David Cumming, Chief Investment Officer for Equities at Aviva Investors.

"By fully integrating our approach across stewardship and the investment teams, we will be able to maximise our ability to influence the companies we have targeted towards positive climate strategies."

(Reporting by Simon Jessop; editing by David Evans)

Originally published Mon, February 1, 2021

Aviva to Divest From Companies That Don’t Act on Climate: FT

Max Zimmerman
Updated Sun, January 31, 2021


(Bloomberg) -- Aviva Investors, one of Britain’s top asset managers, will divest from oil, gas, mining, and utilities companies that do not meet its expectations on tackling climate change.

The London-based investor has written to the companies, calling on them to set net zero emissions goals and integrate climate risks into their strategy, including their plans for capital expenditure, the Financial Times reported, citing chief investment officer for equities David Cumming.

Cumming told the paper that climate change poses a huge risk to capital markets and that it is a massive disruptor. He said divestment was the last thing Aviva wanted to do but that “we will do it.”

Aviva will divest across both its equity and credit portfolio if companies fail to meet expectations over the next one to three years, he said. Aviva declined to name the companies it is targeting.

Aviva Investors manages 355 billion pounds ($486 billion) and has stakes in 30 of the world’s largest oil, gas, mining and utilities companies, according to the Financial Times. Cumming said he expected other asset managers to increasingly consider divestment as a response to companies’ efforts on climate change.


©2021 Bloomberg L.P.