The carbon footprint of unit-linked assets managed by Mandatum Life has been measured for 2019. Measured by financed emissions*, the total carbon footprint of the investments was 26 per cent below the general market indices. In equity investments, the carbon footprint was 37 per cent below the market index, and in fixed income investments, 21 per cent below.
The annual carbon footprint of the investments totalled 1,357,008 (1,151,030) CO2e tonnes. The increase in the total carbon footprint compared to the previous measurement is due to the increase in assets under management. The investments’ average carbon intensity**, which defines the investee companies’ emissions in relation to annual net sales, decreased 20 per cent from the previous year.
Taking climate change into account and efficiently managing the climate risk is one of the focal points of Mandatum Life’s investment operations. Mandatum Life has committed to measuring and reducing the carbon footprint of its investments over time.
“We are pleased to see that the climate impacts of our investments are significantly smaller than those of the index. Particularly in equity investments, the carbon dioxide emissions of the companies we own are clearly below the benchmark index. Considering all asset classes, our carbon footprint in relation to the invested capital decreased from last year,” says Carolus Reincke, Head of Multi-Asset Solutions, Mandatum Life.
“We continuously work to promote this matter by managing the climate risks of our investment operations. We determine the carbon footprint of our investments annually, and monitor it separately for each investment basket or fund. In practice, the portfolio managers for each investment basket, fund or responsibility area are responsible for effectively managing the climate risk of the investment object they manage. For our customers, this is reflected, for example, in being able to check the carbon footprint of individual investment baskets in the investments’ monthly reviews,” explains Reincke.
As a member of the Portfolio Decarbonization Coalition investor network, Mandatum Life’s objective is to minimise investments’ emissions globally by actively managing the climate risks of investment operations and offering opportunities to invest in companies with a smaller carbon footprint. Through the UN’s Montréal Pledge, Mandatum Life annually publishes the results of its investment emissions measurement.
In addition, the company maintains a Responsible Investment Policy, which defines the starting points and goals of its responsible investments in greater detail. The policy outlines the ways responsible investment is implemented in various asset classes and takes a closer look at Mandatum Life’s commitment to taking climate change into account.
* Financed emissions reflect the investment portfolio’s emissions in relation to the invested capital. In equity investments, emissions are proportioned to the company’s market value, and in fixed income investments, to the amount of debt. Emissions are allocated to the investment portfolio in proportion to the holdings.
** Average carbon intensity is an alternative way of measuring an investment portfolio’s carbon risk. With carbon intensity, emissions are proportioned to the company’s net sales. The reported figure is a weighted average of the investments’ carbon intensity.
How the measurement was carried out:
- The measurement covered the investment assets managed by Mandatum Life within the company’s own investment baskets, full-mandate wealth management and allocation investment baskets, as per the situation on 31 December 2019.
- The measurement was carried out by ISS ESG.
- The measurement covers approximately 78 per cent of the unit-linked investment assets managed by Mandatum Life Investment Services Ltd.
- The carbon footprint of the investees is based on the Carbon Disclosure Project’s (CDP) data on the emissions of the companies. When no data is available, the emissions have been estimated using ISS ESG’s sector-specific models.
Carolus Reincke, Head of Multi-Asset Solutions, email@example.com, tel. +358 50 355 4540
Niina Riihelä, Vice President, Marketing and Communications: firstname.lastname@example.org, tel. +358 40 728 1548