New analysis from Ceres shows top North American investors with net zero commitments have elements of climate action plans in place

A new analysis of 48 of the largest North American investors finds most of them have bold commitments to align their investing and portfolios with a net zero emissions future and most of those with commitments have developed elements of Investor Climate Action Plans, or ICAPs, to show how they will deliver on them.  

The analysis, Investor Climate Action Plans are Becoming a Norm, released today by Ceres, examined the public climate disclosures made by these investors, collectively representing more than $60 trillion in assets under management, more than half of the global GDP.  The assessment looked at how investors plan to address the financial risk caused by climate risk, translating their climate commitments into actions representative of the focus areas of the ICAPs framework—investment, corporate engagement, policy advocacy, and investor disclosure—and widely disclosed comparable formats.  

The analysis found that 77% of the 48 investors have committed to net zero emissions by 2050 or sooner, and nearly 90% of investors with net zero commitments have components of ICAPs in place demonstrating progress toward these goals. The assessment found that investors are progressing across all areas of the ICAPs framework.  

Specifically, it found: 

• Investment: 85% of the investors analyzed have either established a baseline carbon footprint for their portfolio or are assessing portfolio-level carbon exposure. 63% of investors have moved towards using advanced risk assessment-scenario analysis.  

• Corporate Engagement: 81% of investors analyzed conduct bilateral engagements with the companies they are invested in. 

• Policy Advocacy: About half of the investors reviewed mention their advocacy plans or advocacy policies in their Task Force on Climate-related Financial Disclosures (TCFD) reports, or standalone investor climate action plans, and participate in one or more public policy initiatives. 

• Investor Disclosure: Most investors assessed include their investor climate action plans (ICAPs) in their TCFD reports.  

• Governance: Of the 48 investors reviewed, all 37 investors who made a net zero commitment have board-level oversight over their climate strategy and plans. 

“We welcome the response to the ICAPs framework and the ongoing momentum and uptake of climate action plans by investors considering climate risk consistent with their fiduciary duty,” said the Rev. Kirsten Snow Spalding, Vice President, Investor Network, Ceres. “These action plans serve as a blueprint for investors defining their approach to navigating climate risks in portfolios and investment opportunities in the shift to a low-carbon economy. As our analysis shows, transition planning is not just possible but already in progress among most of the largest North American investors.”  

As independent fiduciaries with an overarching duty to consider risk and return in the interests of their clients and beneficiaries, investors voluntarily develop ICAPs. The plans outline the goals, actions, and accountability mechanisms an investor pursues to integrate robust climate strategies into its investments, operations, and strategic planning, with an overarching theme of governance of climate risks and opportunities.   

For investors with net zero commitments, ICAPs are the accountability mechanism for stakeholders showing how commitments will be implemented. For investors who have not yet made a net zero commitment, ICAPs show investors’ clients, beneficiaries, and peers how the investors are starting to address climate risks and opportunities. The development of voluntary ICAPs also prepares North American investors as they are subject to new European regulations requiring transition plan disclosures. 

“As our analysis shows, developing and publishing ICAPs is becoming a standard practice within the investment community, contributing to greater market stability and predictability,” adds Spalding. “It also signals to portfolio companies and their sector peers that innovation around new products and lines of business reduces climate risks, increases competitiveness, access to new markets, and attracts investor capital.” 

Learn more about ICAPs here and download our full analysis here.  

About Ceres  

Ceres is a nonprofit advocacy organization working to accelerate the transition to a cleaner, more just, and sustainable world. United under a shared vision, our powerful networks of investors and companies are proving sustainability is the bottom line—changing markets and sectors from the inside out. For more information, visit ceres.org.