(Reuters) – Legal & General Investment Management, Britain's largest asset manager, said on Tuesday that it would release four companies from a number of its funds because of their "inadequate" response to the challenge of climate change, including the American insurance company American International Group Inc.
The others to be divested are the Chinese lender Industrial and Commercial Bank of China, the US toolholder PPL Corp. and Chinese dairy products owned by China Mengniu Dairy.
Everyone had either not responded adequately to corporate involvement or had violated LGIM's "red lines" regarding involvement in the coal sector, their carbon emissions or their links to deforestation, the chief financial officer said in a statement.
They join nine other companies previously excluded for similar shortcomings by LGIM, which handles £ 1
As part of its 2018 Launc climate impact, LGIM, part of the insurer Legal & General PLC, said companies would be excluded from actively managed funds holding around £ 58 billion in assets and all four would receive voting sanctions using shares held throughout the share register.
"We have made consistent inquiries over a multi-year period … (companies are) really do not meet what we consider to be basic minimum standard expectations when it comes to managing climate change in their sectors," said Yasmine Svan, senior sustainability analyst at LGIM.
The exceptions follow a commitment from LGIM in October to increase the number of companies they conduct over climate change to 1,000 out of 100.
That press was already beginning to bear fruit, LGIM said on Tuesday. , with 22% of companies on their "priority" list now setting zero CO2 emissions targets.
During the current season for AGMs, LGIM said that 130 companies would vote against failing to meet their minimum climate change standards, primarily in the banking, insurance, real estate, technology and telecom industries.
As global policy makers prepare for the latest round of climate talks in Glasgow later this year, LGIM CEO Michelle Scrimgeour said the asset.
“Progress cannot be made by acting in isolation and we, as investors, have a real role to play in a responsible distribution of capital and act as managers of our investment firms to encourage greater progress in meeting our overall sustainability goals.
Ms. Mengniu said it "proactively supports the goal of achieving carbon neutrality by 2060 and leading the carbon neutral industry with regular emission reduction targets and the publication of roadmaps."
"In 2021, Mengniu will complete a detailed account of carbon dioxide emissions of its subsidiaries, formulating goals and plans for reducing carbon dioxide emissions and thereby reducing the product's carbon footprint," the company says.