Climate change is a complex issue that presents material risks and opportunities for investors. These risks and opportunities come from multiple, interacting drivers, including physical and natural resources, regulatory action and technological innovations. The impact of climate change is felt variably across different investment sectors, geographies and asset classes. In fact, some of these impacts are already inevitable.
In 2015 we signed the Paris Pledge for Action, which affirms our commitment to a safe and stable climate in which temperature rise is limited to under 2 degrees Celsius, and pledged our support to ensuring that the level of ambition set by the COP21 Paris climate agreement is met or exceeded.
Given the Fund’s long-term horizon and purpose, it is important that the risks and opportunities stemming from climate change are factored into our investment strategies and ownership practices. The goal of our climate change strategy, which we announced in October 2016 is to make the Fund more resilient to climate-related risk. We believe it will improve our portfolio.
In August 2017 we announced that our global physical passive equity portfolio was now low-carbon.