M&G’s commitment to a ‘net zero’ future

5 min read 11 Jan 21

Summary: Urgent action is needed on climate change and M&G is determined to support the goal of net zero greenhouse gas emissions by 2050 through its global investments and corporate behaviour.

The scientific evidence is clear. Climate change is one of the biggest threats to our planet and its people. The effects of rising global temperatures are already being felt, presenting immediate risks to the global economy, the long-term health of the environment and to society.

The current trajectory of greenhouse gas (GHG) emissions implies that global average temperatures could rise in excess of 4°C above pre-industrial levels by 2100. To limit this increase to well below 2°C, in line with the Paris Agreement, will require no further GHG emissions from 2050. We have only three decades to achieve this ‘net zero’ target.

As a FTSE100 company and as a long-term asset owner and asset manager, M&G plc embraces its responsibility, to both our customers and wider society, to invest in ways which ensure a sustainable future, including tackling climate change and enabling the transition to a low-carbon economy.

Our commitments as an asset manager

As stewards of the long-term savings of millions of people, and as an international company of scale, we want to lead by example in helping deliver on the Paris goals.

We announced in March 2020 that, as an asset owner and asset manager, we commit to net zero carbon emissions on our total book of assets under management and administration by 2050. This includes all investments made by M&G Investments, the asset manager within M&G plc.

Reflecting this commitment, we became a founding signatory of the Net Zero Asset Managers initiative in December 2020. This leading group of asset managers supports net zero GHG emissions no later than 2050, and supports investing aligning with this goal.  As part of the initiative, we also commit to prioritising the reduction of real economy emissions within the sectors and companies in which we invest.

As well as allocating capital towards lower emissions sectors and technological solutions that mitigate the impact of climate risk, we are working to support the transition to a low-carbon economy through active engagement with company management. We engage with investee companies on climate change and use our votes, where we are shareholders, to drive change.

We are also encouraging greater climate-related disclosures. This reflects M&G’s support for the recommendations of the Task Force on Climate-Related Financial Disclosures, which call for businesses to disclose better information about the climate risks they face.

To gain a better picture ourselves on our investments’ exposure to the financial risks and opportunities from climate change, we are also investing in improving our research and analysis capability and developing proprietary tools across assets, sectors and geographies. 

Our commitments as a company

In March 2020, M&G plc announced its commitment to reduce operational carbon emissions to net zero by 2030, at the latest.

We have already made progress towards this target through energy efficiencies, renewable energy supplies, and reducing resource use across our offices. We are also cutting emissions from all business travel by transitioning to a lower carbon fleet, promoting agile working, and reducing air travel. Where there are no suitable alternatives, we will offset any remaining emissions through accredited offsetting schemes.

Through our global investments and our own corporate behaviour, we will play our part in the transition to a low carbon economy. That’s why M&G has pledged its support for the United Nations Climate Change Conference COP26, and its agenda of collection action, due to be held in Glasgow in November 2021.

For financial advisers only. Not for onward distribution. No other persons should rely on any information contained within. This financial promotion is issued by M&G Securities Limited which is authorised and regulated by the Financial Conduct Authority in the UK and provides ISAs and other investment products. The company’s registered office is  10 Fenchurch Avenue, London EC3M 5AG. Registered in England and Wales. Registered Number 90776.

By Ben Constable-Maxwell

The value of investments will fluctuate, which will cause prices to fall as well as rise and you may not get back the original amount you invested. Past performance is not a guide to future performance.

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