Prudential Financial commits to net-zero emissions by 2050

Written by Adam Cadle

01/11/2021

Prudential Financial has today announced its commitment to achieve net-zero emissions across its primary domestic and international home office operations by 2050.

To accelerate the company’s longstanding commitments to mitigate the impacts of climate change, Prudential is also setting an interim goal to become carbon neutral by 2040. These actions are aligned with the latest climate science of limiting global warming to 1.5 degrees Celsius or lower, as specified in the Paris climate accord.

“As a global insurer and investment manager, we understand the magnitude and urgency of climate change, and that we have a responsibility to minimise our impact,” said Charles Lowrey, chairman and CEO of Prudential. “This net-zero commitment is an important step toward a more sustainable future for our customers, employees, investors and communities.”

The actions announced today build upon Prudential’s 2019 Global Environmental Commitment, which include operational and investment goals aimed at mitigating climate change and other environmental risks.

Prudential will reduce home office operational emissions globally (Scope 1 and Scope 2) by consolidating its real estate footprint, investing in energy-efficient capital improvements for owned properties, and purchasing renewable energy, where available, and then will utilise carbon removal strategies to eliminate its remaining carbon footprint. The company’s home office operations include owned and leased office space, data centers and garages in the United States, Japan and Brazil.

Prudential next plans to assess Scope 3 emissions, including those related to the company’s owned assets within its $460bn General Account portfolio. As an initial action, Prudential will begin restricting new direct investments in companies that derive 25% or more of their revenues from thermal coal. This restriction is included in Prudential’s enhanced Responsible Investing Policy.

“Prudential is a company committed to delivering on its promises. We will hold ourselves accountable to these targets as we make meaningful progress toward addressing climate risk,” said Rob Falzon, vice chair of Prudential, who oversees the company’s Steering Council on Climate Change. “These carbon reduction targets are underpinned by our longstanding efforts to effectively engage with our stakeholders and provide transparency on our environmental actions.”

Other recent environmental actions taken by the company include sustainable finance transactions such as issuing an inaugural green bond. In May 2021, PGIM Real Estate, the real estate investment business of PGIM, Prudential’s global investment management arm, committed to reducing operational carbon emissions from its global portfolio of managed properties to net-zero by 2050.

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