How Globalance plans to achieve
its own net-zero target
Our Climate Transition Plan
Globalance is committed to aligning its asset management portfolio with the objectives of the Paris Agreement. Our net-zero target is geared towards 2050. Globalance is committed to achieving the target portfolio temperature of 1.5°C by 2040 to do justice to the time lag between financing and its implementation in the real economy.
Die Globalance Klimaziele
Globalance chooses the ITR temperature as the main metric to determine whether assets under management (AuM) are aligned with the Paris climate target. Based on the logic of the Science Based Tagets initiative (SBTi), the portfolio temperature of 1.5°C must be reached ten years before the desired net-zero target is reached so that the 1.5°C-aligned companies have enough time to implement the planned measures to achieve their climate targets.
We also use a control metric: the emission intensity of assets under management (financed emissions; t CO2e-equivalents /CHF million invested).
Globalance invests with the futuremover philosophy, which focuses on megatrend revenue and a positive footprint.
Four levels of action of the climate transition plan
To achieve our own net-zero target, we focus on so-called financed emissions, which account for 99.9 per cent of the greenhouse gas emissions in Globalance’s value chain. This refers to indirect emissions of companies in which Globalance invests client assets. The Glasgow Financial Alliance for Net Zero (GFANZ) defines four levels of action:
Financing climate solutions
Globalance invests with its futuremover philosophy, which focuses on megatrend revenue and a positive footprint. Companies are selected whose products and services contribute to overcoming global challenges. For example, the financing of climate solutions has been an important aspect of Globalance’s activities since the company was founded. We will calculate and publish the share of revenue of portfolio companies generated from climate solutions on an annual basis.
Financing of 1.5°C aligned companies
Globalance invests mostly in companies leading in the areas of sustainability and climate. The management and ongoing review of the climate path are mainly based on the temperature metric (“Implied Temperature Rise“), which Globalance obtains from specialists at MSCI. The emission intensity of the portfolio serves as a control variable (t CO2 equivalent/CHF million of invested capital).
Financing and promoting the transition of companies to a 1.5°C pathway
Globalance does not pursue an explicit strategy of supporting transformation companies. Nevertheless, many companies we have selected are not yet on a 1.5°C path. This makes our stewardship and engagement activities all the more important. Globalance publishes a separate report on these.
Phasing out fossil fuel investments
Since Globalance was founded, investments in coal, oil and gas have been excluded. We publish the remaining revenue in these areas (tolerance) annually. In addition to the GFANZ guidelines, the wording of our net-zero target and the coverage of asset classes are based on the Science-Based Targets Guidance for the financial sector. GlobalanceBank AG and our subsidiary Globalance Invest in Munich are part of the greenhouse inventory and the net-zero target. Our Go4Balance subsidiary currently generates hardly any emissions and is not part of the analysis.
We are in active dialogue with invested companies to encourage them to operate more sustainably.
Stewardship
We can influence the companies we invest in through engagement. This active dialogue is based on detailed analyses and aims to continuously review and motivate the players in the real economy to raise their ambitions.
