Asset owners call on investors to ‘raise the bar’ on climate stewardship

A coalition of asset owners representing US$1.5 trillion have released guidance to help investors “raise the bar” on climate stewardship through better collaboration.

The statement, signed by 26 pension funds led by The People’s Pension, Brunei Pension Partnership and Scottish Widows, calls on asset managers to “develop and evidence an independent robust stewardship strategy that addresses the urgency of action needed on climate-related risks and builds resilience into financial markets”.

It includes five guiding principles to strengthen and harmonise climate-related action within the investment community: engaging with the market and policymakers to push climate ambition; prioritising collaborative initiatives; deepening engagement with high-impact sectors on their climate transition plans beyond targets and disclosures; implementing escalation processes for when climate expectations are not met; and ensuring climate stewardship activities are appropriately resourced.

Addressing the systemic risk of climate change

Shipra Gupta, Investment Stewardship Lead at Scottish Widows, said: “Systemic risks and opportunities, like climate change, require systemic and systematic interventions across the investment value chain. This statement sets out a clear principles-based framework of asset owner expectations of their asset managers encompassing the importance of influencing and shaping policy and regulation, of working in collaboration with stakeholders, of using their shareholder rights and responsibilities more effectively, and all of it being embedded in appropriate sectoral strategies and relevant technical expertise.”

According to the coalition, the statement responds to feedback from asset managers who wanted asset owners to clarify and harmonise their climate stewardship expectations.

A 2023 UK study of asset managers’ votes in shareholder resolutions at oil and gas companies’ AGMs showed evidence of divergence with asset owners’ wishes on climate stewardship – which the researchers interpreted as “a reflection of the wellfunded ‘anti-ESG’ campaign”.

Asset managers’ voting activities misaligned with asset owners on climate

An analysis of the results of BP, Chevron, ConocoPhillips, Equinor, Eni, ExxonMobil, Repsol, Shell, and TotalEnergies’s AGM that year also showed that all ambitious climate-related shareholder resolutions were rejected. 

Since then, the anti-ESG movement has been bolstered by Donald Trump’s reelection as US President, and in January 2025, the Net Zero Asset Managers Initiative announced the suspension of its activities following BlackRock’s exit.

“We, as asset owners, are the owners of capital and the mandates, and in these challenging times it is now more important than ever as an asset owner community to send a strong collective principle-based signal to our asset managers as to what we expect of them,” said  Leanne Clements, Head of Responsible Investment for People’s Partnership, provider of The People’s Pension. 

“Time is running out in the lead-up to 2030, asset owners and asset managers must work together in partnership to drive meaningful change: not only in the companies in which we invest, but in the underlying economic, social and environmental systems upon which our members depend”.