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Vanguard commits $290 billion of assets to be net-zero by 2050 -Breaking


© Reuters. FILE PHOTO – A sign is seen on the ground by members of Extinction Rebellion, who protest the investment and use of fossil fuels, in front of Vanguard Asset Management offices in London. This was April 22nd, 2022. REUTERS/To

By Simon Jessop

LONDON, (Reuters) – Vanguard, world’s second largest asset manager, stated that it expected nine funds with $290 billion in assets to achieve the climate goals by 2050. It also expects at least 50% of the way by 2030. This drew criticism from activists for its lackluster ambition.

Privately-owned U.S. companies are among more than 230 that have signed up for the Net Zero Asset Managers Initiative (NZAM). This group of investors is committed to supporting the goal to reach net zero greenhouse gas emissions by the middle of the century.

Signatories are required to contribute emissions as part of the joining.

But, they declined to set any formal targets or expectations on their bulk assets (more than $5 Trillion) which are held in funds that track indexes. Many of these funds contain companies with low climate goals and high emissions.

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Vanguard reported that 70% of equity index fund assets are invested in companies with an emission reduction goal. However, the vast majority of these funds have not been fully aligned with measures to bring them to net-zero.

Vanguard indicated that it would work with companies to discuss their climate plans. However, companies, markets, and policymakers needed to coordinate efforts.

Campaigners reacted to the criticism and criticized the ambition of the company.

Casey Harrell (Senior Strategist, Sunrise Project) stated that Vanguard “should be laughed out of NZAM because this absurd attempt to a climate goal” Vanguard must start again, and do better.

Eileen Flanagan, Campaign Director of Earth Quaker Action Team, said: “Climate pledges this inadequate make us even more determined to build powerful grassroots pressure to wake up Vanguard’s current leadership.”

(This story corrected target in headline bullet points, first paragraph and removes the fourth paragraph.