Climate change is the greatest challenge of our time. Insight prioritises climate risk analysis and stewardship.
- We support climate-focused groups that help to ameliorate risks from issuers, including inadequate disclosure, and support campaigns that promote environmental themes.
- We participate in industry groups as part of our work managing systemic climate risks, such as the Institutional Investors Group on Climate Change (IIGCC) and Climate Action 100+.
- We developed our first climate risk ratings in 2017 as a comprehensive ranking of fixed income corporate bond issuers that enabled better engagement activity with companies. In 2020, to improve understanding of the key risks that climate change poses and further develop our offering in sustainable strategies, we expanded the scope of the ratings to create two scores for each company; one for its transitional risks and one for its physical risks.
- Our proprietary Prime climate risk ratings are generated for 9,500 corporate issuers and include data for 15 climate-related issues. For more information click here.
- More broadly, we believe we also have a part to play in tackling climate change. Our work in 2020 led us to become a signatory to the Net Zero Asset Managers Initiative in early 2021. By asset class, Insight’s target includes 100% of UK government bonds, and 75% of corporate bond and equity holdings managed in the UK. Please visit Insight’s net zero pledge page for more details of our initial commitment.
- We have a science-based position on thermal coal investments which commits to ensuring any holdings related to thermal coal usage will have a clear and actionable plan to exit coal by 2030 for developed market holdings and 2040 for emerging market holdings, while balancing the imperatives of a Just Transition as stated in the Paris Agreement. This is in line with the scientific evidence requirements set by the Intergovernmental Panel on Climate Change (IPCC) to limit global warming to 1.5ºC. Insight will look to achieve this, where possible, through effective engagement as we feel this is likely to achieve a better real-world outcome. However, the position developed also has an escalation function which may ultimately lead to divestment if coal exit strategies are not sufficiently aspirational. Insight’s thermal coal position is available here.
- Insight has also endorsed the United Nations Principles for Responsible Banking, a set of six principles established by the United Nations Environment Programme Finance Initiative to align banking activities with the Sustainable Development Goals and the Paris Climate Agreement, and become a supporter of the Transition Pathway Initiative(TPI), a global initiative led by asset owners and supported by asset managers which aims to help investors align with the goals of the Paris Agreement.
Many pressing issues require a collective response from the investment community and from wider society. We work with our clients, other investors, governments, companies and civil society organisations to build knowledge and awareness, to share expertise and to create a common voice when engaging with stakeholders in relation to our clients’ investments. Click here for more information about Insight’s memberships and collaborative initiatives.