Investment Innovations Toward Achieving Net Zero: Voices of Influence

CFA Institute Research and Policy Center has convened net-zero thought leaders and investment luminaries to break down the big ideas around achieving net zero. Our Net-Zero Voices of Influence provide practical guidance for investors, asset managers, investment professionals, academics, and regulators. More than 50 authors from North America, Europe, the Middle East, Australia, and Asia contributed to this research collection. Contents Editor’s Letter Brian Bruce (The Center for Investment Research) Net Zero: A Framework for Investors Robert F. Engle (New York University) Introduction Chris Fidler (CFA Institute) I. Strategy Tools Used by System-Level Investors in Their Net-Zero Initiatives Jon Lukomnik and William Burckart (Columbia University) A New Focus for Investor Climate Commitments Tom Gosling (London Business School) Carbonomics: The Economics of Reaching Net Zero Michele Della Vigna, CFA (Goldman Sachs Bank Europe SE), Yulia Bocharnikova, Anastasia Shalaeva, and Quentin Marbach (Goldman Sachs International) Global Trends and Developments in Carbon Pricing Bei Cui, Nga Pham, CFA, Ummul Ruthbah, Trinh Le (Monash University), Jan Ahrens (SparkChange), and Roger Cohen (C2Zero) II. Tactics The Scope of Net Zero: The Use of Carbon Emission Data to Achieve Portfolio Goals Robert Furdak, CFA (Man Group), Tracey Nilsen-Ames (Man Numeric), Anna-Marie Tomm (Man Group), Jeremy Wee, CFA, and Valerie Xiang, CFA (Man Numeric) Attribution of Portfolios with Climate-Related Signals Andrew Ang, Debarshi Basu, and Marco Corsi (BlackRock) Aligning Investments with the Paris Agreement: Frameworks for a Net-Zero Pathway Raul Leote de Carvalho, Jane Ambachtsheer, Alexander Bernhardt, Thibaud Clisson,Henry Morgan, Guillaume Kovarcik, and François Soupé (BNP Paribas Asset Management) Building “Net-Zero-Aligned” Portfolios Antonios Lazanas, Zarvan Khambatta, CFA, Yingjin Gan, Lingjuan Ma,and Niall Smith (Bloomberg) Net-Zero Investing: Harnessing the Power of Unstructured Data Andy Moniz, CFA, Devin Nial, Matthew Picone, CFA, Lukasz Pomorski,and Jerry Yu (Acadian Asset Management) 3D Investing: Implications for Net Zero Clint Howard and Mike Chen (Robeco) Carbon Emissions, Net-Zero Transition, and Implications for Equity Portfolio Risk Gregoire Campos, Harindra de Silva, CFA, and Megan Miller, CFA (Allspring Global Investments) Integrating Forward-Looking Climate Metrics in Corporate Fixed-Income Index Portfolios Kushal Shah, Alexis Royer, CFA, and Rupert Cadbury (State Street Global Advisors) III. Case Studies Reconciling Portfolio Diversification with a Shrinking Carbon Footprint Patrick Bolton (Columbia University and Imperial College), Marcin Kacperczyk (Imperial College), Henrik Lorin Rasmussen (PenSam), and Frédéric Samama (Sciences Po and Columbia University) Green and Transition Finance on the Municipal Level: Case of Huzhou City Ma Jun and Yunhan Chen (Institute of Finance and Sustainability)