NZAOA sets direction for members on policy engagement and transition planning

Written by Adam Cadle

05/12/2023

The UN-Convened Net-Zero Asset Owner Alliance has made strides on two crucial elements for working on net-zero commitments – creating a transition plan and aligning lobbying and advocacy.

The Alliance’s Policy Engagement Guidelines encourages members to integrate four policy engagement principles that would advance their climate commitments. The four principles define what a net-zero-aligned approach to public policy engagement and advocacy looks like. Such an approach is:
- accountable, with members’ activity reflecting the interest of its stakeholders;
- active, as it assists policymakers in finding solutions to transition challenges and developing policy;
- consistent, as engagements should be in line with individual member’s own net-zero commitments;
- and transparent, as members should be able to explain how they ensure their engagement with public policy debates are consistent with their climate commitments.

A Tool for Developing Credible Transition Plans; Public edition for asset owner pilot-testing also sets out practical steps for both developing and evaluating transition plans – recognising asset owners’ dual role as both preparers and users. To capitalise on the overlap between commonly required disclosures and the existing Alliance member activities, the paper provides guidance for mapping Alliance members’ activities against five robust transition plan frameworks.

“It’s critical that asset owners work to drive an enabling policy environment, without which it would be impossible for investors to fulfil their net-zero commitments. The Alliance’s new Policy Engagement Guidelines encourage members in this regard,” Günther Thallinger, board member, Allianz SE and chair, Net-Zero Asset Owner Alliance, said.

“On a company level, credible climate transition plans will be key, as they drive capital allocation and climate risk management. To address ambiguity, as guidelines and standards are evolving, the Alliance’s Tool for Developing Credible Transition Plans breaks down the steps for creating a transition plan for asset owners and shows how members are already well-positioned to do so.“

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