ACC to decarbonise it portfolio

The Accident Compensation Corporation has announced a target to halve the carbon intensity of its $46 billion investment portfolio by 2030.

Wednesday, June 17th 2020, 5:43PM

The Accident Compensation Commission has a new climate change policy which includes decarbonising its $46 billion investment equities portfolio.

This move is in line with the intent of the Climate Change Response (Zero Carbon) Amendment Act passed last year, which has a net zero emissions target for all greenhouse gases other than biogenic methane by 2050.

ACC will align with the Climate Change Response (Zero Carbon) Amendment Act. This means reducing the carbon intensity of the investment team's global equity portfolio by at least 50% by 2030 compared to 2019 levels.

"This position will remain under active review as we move towards net zero, and we may alter the ambition of the approach as we gather more evidence about the costs and opportunities. We may adjust the position to at least be consistent with the five-year emissions budgets that will be set by the Climate Change Commission. We're not ruling out taking a more ambitious path should progress exceed the targeted reductions," ACC says.

"Achieving these targets will require hard work and some significant changes over the next decade,"ACC chairman Paula Rebstock says.

"In managing our investments, we must balance the objectives of maximising returns to pay for the future costs of injuries, while investing in a way that is ethically acceptable to New Zealanders.

"The passing of the Zero Carbon Act last year, with bi-partisan support, reflects the ethical concerns of New Zealanders are evolving. This framework – and the actions associated with it – acknowledge that change."

ACC chief executive Scott Pickering says; "ACC is not starting from scratch. We've already been decarbonising and reweighting the investment portfolio and made steady progress in reducing corporate emissions."

"Carbon intensity in our global equities portfolio has fallen 19% over the past 10 years. This reflects developments within companies we have invested in. Most of the investment growth is now in low-carbon activities, such as technology and other services.

"The trend appears to be that overall carbon intensity is trending down by about 2% per year. Continuation of this trend is pivotal to us meeting our emission objectives. We'll use our influence as a shareholder through proactive engagement on climate change.

"In December 2019, we added companies who generate at least 30% of their revenue from thermal coal production to our list of excluded investments. We added a total of 54 companies to the exclusion list as a result."

Tags: ACC Climate Change