12 March 2020
HESTA first Australian backer of global climate action initiative
HESTA has become the first Australian investor to pledge support for the Transition Pathway Initiative (TPI) – a global asset owner-led initiative that assesses companies’ preparedness to transition to a low-carbon economy.
Rapidly becoming a corporate climate action benchmark, the TPI provides a tool to help investors understand how companies are managing climate change and the risk it poses to their businesses.
HESTA CEO Debby Blakey said the TPI would further inform the investment processes and decisions of large asset owners like HESTA, and provides additional insights to support active ownership activities.
“We’re proud to be among the leading global investors supporting this important new initiative,” Ms Blakey said.
“The finance sector has a vital role to play in supporting the transition to a low-carbon future and the TPI can increase the effectiveness of asset owners’ long-term stewardship activities.
“Championing a sustainable, low-carbon economy is essential to creating long-term value for our members and supporting a healthier planet and society.”
More than 60 investors globally have pledged support for the initiative since it launched in 2017, representing over $18 trillion in combined assets under management and advice.
HESTA will also join the TPI steering committee, which is co-chaired by representatives from founding signatories the Church of England National Investing Bodies (Church of England Pensions Board, the Church Commissioners and CBF Funds) and Brunel Pension Partnership Ltd (on behalf of the Environment Agency Pension Fund).
Environment Agency Chair Emma Howard Boyd said the group was thrilled HESTA has become its first Australian asset owner supporter.
“We’re delighted to welcome HESTA as the first Australian asset owner to pledge its support for the Transition Pathway Initiative, and we hope that other Australian investors will be inspired to follow in HESTA’s footsteps,” Ms Boyd said.
“The Transition Pathway Initiative provides investors with invaluable information to help them navigate the transition to a low carbon economy and play an active role in helping the world tackle the climate emergency.”
The TPI tool uses publicly disclosed information to evaluate how more than 300 companies from some of the highest-emitting sectors are managing climate change. This includes data on emission reduction plans, and whether these are aligned to the ambitions of the Paris Agreement. The assessment looks at the companies’ strategic planning to manage risks and opportunities arising from a low-carbon economy transition.
The tool also provides analysis within sectors, identifying companies leading their peers at managing climate change.
More information about the TPI is available at www.transitionpathwayinitiative.org