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Climate change: Asian investors aware of risks but face obstacles in directing capital to mitigate them, survey finds
- Study found most investors in the region have established climate policies and set long-term targets to reach net-zero emissions
- But there are ‘significant barriers’ to establishing short- or medium-term climate targets or realigning capital flow at the rate required
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Asian investors are highly aware of the risks associated with climate change but face barriers in setting feasible targets and directing their capital to mitigate those risks, a new report found.
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A total of 116 Asia-headquartered investors with a combined US$27 trillion of assets under management (AUM) have publicly recognised global warming as a source of material risks and opportunities, according to a new analysis published by the Asia Investor Group on Climate Change (AIGCC) on Thursday.
The report, which will be released in full in the first quarter of next year, analysed the environmental practices of 183 Asian investors with US$33 trillion in AUM in 15 markets, including China, Hong Kong, Taiwan, India, Japan, South Korea, and Singapore.
It found the majority of investors in the region have established climate policies and set long-term targets to reach net-zero carbon emissions, and performed well in making widespread climate disclosures aligned with the leading standard, the Task Force on Climate-Related Financial Disclosures.
However, there seem to be “significant barriers” to establishing short- or medium-term climate targets or realigning capital flow at the rate required to protect the region from the related economic and physical damage, according to the report.
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Only 36 investors with US$8 trillion of AUM have set interim targets, and just 20 with US$5 trillion of AUM intend to direct a proportion of their funds towards climate solutions, the AIGCC’s survey showed.
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