Australian Ethical has announced ambitious targets to increase its investment in Climate Critical Sectors, aiming for 40% of its public-market company investments to align with limiting temperature rise to 1.5°C by 2030. The company’s principal ESG development focuses on supporting the fundamental strategic business shifts needed in high-emission sectors such as energy, metals & mining, utilities, building materials, real estate development, transport, chemicals, food, agriculture, and forestry.
Material actions and disclosures
The carbon intensity of Australian Ethical’s investments in listed shares and public non-government fixed income securities is around one quarter of the benchmark, with a 75% reduction compared to the market. The company’s portfolio’s scope 3 emissions are reduced due to strong restrictions on investment in fossil fuel companies, whose scope 3 emissions include the burning of these fossil fuels by their customers.
Australian Ethical’s approach to climate influence includes engaging with companies in Climate Critical Sectors to support their transition to net zero. The company aims to grow the ‘Paris alignment’ of its investment in these sectors, with a focus on energy, metals & mining, utilities, building materials, real estate development, transport, chemicals, food, agriculture, and forestry.