Willis Towers Watson Investments has announced that it is targeting net-zero greenhouse gas (GHG) emissions by 2050 at the latest, with at least a 50% reduction by 2030, across its fully discretionary delegated investment portfolios, which have US$166 billion in assets under management globally.

“Climate change, and a just transition to net-zero GHG emissions, is a systemic and urgent global challenge,” says Craig Baker, Willis Towers Watson’s global chief investment officer. “Working to achieve net-zero [GHG emissions] by 2050 in our discretionary portfolios is completely consistent with the financial goals we have been given by our clients as climate change has the potential to impact returns across multiple asset classes. We have already embedded this in our investment process and, ultimately, in the portfolios we are managing and stewarding.”

“Being strategically ahead of a low-carbon transition will, in our opinion, significantly improve risk-adjusted returns for our clients as the mispricing of climate issues is resolved,” he adds. “In particular, we think that understanding this transition will be one of the biggest sources of alpha across all asset classes and that this opportunity is likely to be greatest in the next few years. We will, therefore, target pathways to net-zero [GHG emissions] that seek out pricing opportunities while delivering a reduction in emissions of more than 50% between 2015 and 2030, consistent with the Paris agreement.”

In addition to integrating climate risk into its multi-asset investment process, the company also offers a range of multi-manager funds where sustainable investment is a key part of the investment proposition, which clients can use to help them achieve their sustainable investment goals.