The European investor beats the American with ‘net-zero’ commitments

The fight against climate change is one of the great challenges worldwide for the coming years. More and more governments and investors are joining these policies that seek to reach ‘net zero’ by 2050; that is to say, be as close as possible to zero emissions. According to a survey carried out by the international asset manager robecoEuropean investors and insurance companies commit to net zero more than in the US, despite the green policy imposed by Biden.This survey indicates that in the Old Continent, 37% of investors has already committed to these investments and 24% are in the process of committing. While in North America only 19% have done so, being surpassed by one point by Asia-Pacific (APAC). Various European investors consider that sustainable investment is the best for the interests of their partners and ‘stakeholders’, so they focus their policies in these directions. This situation is different from that of the US, where investment”ESG is taking on controversial political nuances,” European politicians and regulators generally support action on climate change, they say in the report. This survey, which has been carried out among institutional and wholesale investors from Europe, North America, Asia-Pacific and South Africa, indicates that between them they gather approximately 27.4 trillion dollars (25.4 trillion euros in exchange) in managed assets. By breaking down these amounts, the EU accumulates the largest amount of ‘green’ investments with 10.9 billion dollarsfollowed by the American continent with 9.6 billion and 6.5 billion in APAC. In this fight against the clock, US investors combat with a negative reaction to ESG (environmental, social and corporate governance)since based on the results of the survey, it is more probable that North American investors will resist anti-ESG political and legal pressure if they act on climate change. “It is about to become a political football match rather than an approach that takes into account the real risks derived from the environment, social factors, among others,” they conclude from robeco. On the other hand the 63% of European investors are concerned about future political pressure and/or legal action if positive action is not taken on climate change and other ESG issues. That is, the European governments are putting pressure on managers so that every day their movements are more linked to ‘net zero’. In North America, only one 40% of investors see this as a real concern. Faced with this difference, the person in charge of climate and biodiversity strategy at Robeco, Lucian PeppelenbosHe has commented that in Europe the legislations are very extensive and have large projects and that this influences this figure.“They are world leaders in the transition towards climate neutrality and the circular economy,” he says.. The document also adds that it is now likely that ESG investments in the United States will be part of the next elections and that investors will put more focus on these ‘green’ movements “especially if they believe that climate change has implications ” . The Inflation Reduction Act (IRA in English), better known as the ‘green plan’ of the president of the United States, Joe Biden, has caused different opinions among investors and environmentalists who remain at the foot of the letter the recommendations to be able to achieve the environmental purposes proposed by the different governments. This is a regulation launched in 2022 that is considered one of the most aggressive to address the climate crisis, but it is also with other markets according to experts. Although the measure is considered positive in Europe, the Law includes important aid of up to 430,000 million dollars (400,000 million euros approximately) and has numerous tax exemptions. This, according to Brussels analysts, It can negatively affect the companies of the Old Continent, especially for those who understand electric cars or producers of sustainable technologies. In addition, the European Commission (EC) has decided to include nuclear energy within the industries that the EU considers to be ‘clean’. Its objective? Counteract the impact that the IRA will have on the European economy. The idea is to be as close as possible to 40% of the annual needs for the use of strategic zero-balance technologies manufactured in Europe by 2030.