LONDON: Larry Fink, chief executive of the world's biggest asset manager BlackRock, on Tuesday warned the companies it invests in that they need to show how they will be able to survive in a world aiming for net-zero carbon emissions by mid-century.
In his annual letter to the management of companies across the world, Fink said they would also need to make clear how the plan is integrated into the company's long-term strategy and reviewed by the board.The focus on companies' net-zero strategies comes as policymakers and campaigners push asset managers to do more to hold companies to account over their climate plans, ahead of the next round of global climate talks in Scotland later this year.
"The world is moving to net zero, and BlackRock believes that our clients are best served by being at the forefront of that transition," Fink said. "We are carbon neutral today in our own operations and are committed to supporting the goal of net zero greenhouse gas emissions by 2050 or sooner. No company can easily plan over thirty years, but we believe all companies – including BlackRock – must begin to address the transition to net zero today."
To help investors prepare their portfolios for the transition to a net-zero economy, Fink flagged a number of fresh steps the asset manager would take, including, where possible, publishing a temperature score for its equity and bond funds.The group would also look to incorporate climate considerations into its capital markets assumptions and implement a"heightened-scrutiny model" when deciding which assets to include in its actively managed portfolios.