Insurers ahead of pension funds with investments in funds allocating to transitioning companies

Written by Adam Cadle

21/05/2024

Insurance companies are ahead of pension funds with their investments in funds or strategies allocating to transitioning companies, a new report published by Robeco has stated.

Forty-seven per cent of insurance companies already invest in funds or strategies allocating to transitioning companies, and 27% plan to within the next one to two years.

This is compared to 29% of pension funds already investing in transitioning companies and 26% plan to do so within the next couple of years. By region, European investors are most likely to invest in transitioning companies (45%) or are planning to do this in the near future (26%).

The report also revealed that the number of APAC investors for whom climate change is central to, or a significant part of, their investment policy was 79%, surpassing Europe (76%) for the first time. Enthusiasm is, however, continuing to fall in North America amid political wrangling over the perceived cost of integrating ESG factors into investments, where only 35% prioritise climate investing. This knocked back the global average to 62% from 71% in 2023, but still signals that a majority of investors have climate investing as a priority.

Lucian Peppelenbos, climate and biodiversity strategist at Robeco, said: "When we look at the survey findings, we can see that many investors are adopting a focused and diligent approach to the work of decarbonizing investment portfolios and moving towards the low-carbon economy of the future. As they get to grips with the hard work involved in the climate transition, there is less naivety, and more careful deliberation and scrutiny over what is needed to embed sustainability into the many aspects of running investment portfolios.”

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