SSGA Targets Decarbonization Across Portfolios

State Street Global Advisors (SSGA) has released a new decarbonization strategy for its investment portfolios, forming part of the investment manager’s net zero investment commitment.

Three targets for the firm’s in-scope assets have been created based on the Net Zero Investment Framework, which was set up by the Institutional Investors Group on Climate Change and its Paris Aligned Investment Initiative.

It follows SSGA’s commitment to the Net Zero Asset Managers initiative, which was launched in December 2020 and now boasts 236 signatories with $57.5 trillion in assets between them.

SSGA aims to reduce its financed Scope 1 and 2 carbon emissions intensity by 50% by 2030, it detailed on its website. It also wants to ensure that at least 70% of financed emissions are net zero or aligned with net zero by engaging with portfolio companies – before increasing this ratio to at least 90% by 2030.

Additionally, the firm wants to have 100% of its investments in carbon-intensive sectors to be achieving net zero or aligned to net zero goals by 2040. This will also be achieved through engagement with portfolio companies.

Cyrus Taraporevela, CEO of State Street Global Advisors, said: “We must do our part to hold ourselves accountable for progress. Last April, we joined the Net Zero Asset Managers Initiative to ensure our portfolios reach net-zero greenhouse gas emissions by 2050 or sooner and set interim targets for 2030.”

To support its work, SSGA has doubled the headcount of its engagement team this year as well as investing in data processing and analysis tools. It also said it was likely to expand its coverage to other asset classes beyond listed equities and corporate bonds to potentially include sovereign bonds and cash.