SPECIFIC CLIMATE-RELATED PRIORITISATION
As part of our work to get to net zero, we identify and analyse our Top 10 emitters. We believe that by focusing our efforts, we can deliver the biggest impact. Our Top 10 emitters represent around 40% of our entire active equity carbon footprint!
We use a variety of tools to identify our Top 10 emitters:
- Reviewing assessments by Climate Action 100+ and the Transition Pathway Initiative to identify which companies have the poorest scores across the full range of metrics - these include scores on target setting, strategy, climate policies etc as well as the company's actual transition alignment.
- Emissions data, to identify which companies are the heaviest emitters.
- Value of our holdings, to prioritise the highest value holdings and achieve the highest impact.
- Mercer's ACT reporting, which highlights the companies which are contributing the most to our overall emissions.
These tools provide the foundations to our engagement, we analyse and challenge the data to build a well-rounded understanding of the highest emitters, to understand how future-proofed these holdings are. We may be happy to invest in a highly emitting company if our investment can help finance its transition to a low carbon economy. We may be less satisfied with the inclusion of a company which is unable or unwilling to transition, as this presents a financial risk to the Fund. Any concerns or discrepancies with the overall approach will be raised with the investment manager that manages the appropriate mandate. Through our engagement, we can understand what work is being achieved to reduce emissions. The position will be monitored on an ongoing basis.
Read more in the extract from our Climate Report below, which lists our Top 10 emitters and how we have analysed them. We showcase two names to illustrate one company that we believe has a place in our portfolio, and one which we have identified as incompatible with our goals.
"Wiltshire Pension Fund endeavours to invest to be part of the climate solution, and where our engagement highlights no improvement to reaching our net-zero targets, we will hold our managers accountable for the investment rationales and take proactive measures to ensure the highest standards of social and environmental impact can be achieved. Our final stage of escalation, where we feel we have exhausted all avenues, will be to request that the company is divested from our portfolio."