Transitioning to a low-carbon economy requires significant investments to replace existing fossil-based technologies. OP Asset Management's updated climate targets take into account both the risks and the economic opportunities of the low-carbon transition.
"Our goal is that 75% of OP's direct equity and fixed income investments will be aligning to the net-zero pathway or be net-zero by the end of 2030. Net-zero means that the greenhouse gas emissions generated are equal to the removal of greenhouse gases," says Annika Esono Manninen, OP's Lead ESG Specialist.
At the same time, OP Asset Management updated its view on fossil fuel-based revenues for companies. Going forward, OP Asset Management will exclude from our direct equity and fixed income investments in OP responsible investment funds those companies who derive more than 5% of their revenue from coal, oil or gas exploration, distribution, refining or production business, and which do not have a clear and credible strategy for transitioning from fossil fuels to more sustainable business models.
"In the future, our portfolio managers will have access to more comprehensive information on companies' climate strategies and the credibility of their climate targets. We will also initiate new discussions with our investee companies regarding the low-carbon transition and encourage them to set ambitious climate targets. Active ownership has always been the cornerstone of our operations," says Esono Manninen.
5.11.2024 08:37
OP Asset Management has updated its climate targets - this is what the update means for our investments
The carbon intensity of OP funds was 50% lower at the beginning of 2024 compared to 2019. This corresponds to the interim emission reduction target of halving the carbon intensity of OP funds by 2030. The updated climate targets further support the low-carbon transition, as investees are now required to have a credible strategy for transitioning away from fossil fuels.