Actis targets 2030 for 60% AUM aligning with net zero

Actis has committed to ensuring that 60 percent of its total AUM is aligning towards a net zero pathway as defined by Paris Aligned Investment Initiative by 2030.

To be considered aligning towards a net-zero pathway, companies are required to:

• have set a short- or medium-term emissions reduction target;
• be disclosing Scope 1, 2 and material Scope 3 emissions data;
• have a plan relating to how these targets will be achieved.

Actis also confirmed that all portfolio companies will be required to develop Net Zero plans within two years of receiving investment. “Majority ownership is absolutely key,” Actis head of sustainability Shami Nissan told New Private Markets. “If you are a private markets investor like Actis and you have majority ownership, you have a lot of leeway over the Net Zero journey of a company. We feel quite confident that we can achieve 60 percent of AUM,” Nissan added.

The firm is starting from a baseline of “close to zero”, said Nissan. “It is assumed that in 2021 (our baseline year) none of our AUM was aligning to net zero due to the fact that our target methodologies were not designed nor in use at that time.”

Actis is also targeting 50 percent of its AUM to be invested in “climate solutions” by 2030. This is defined as investments that reduce emissions through decarbonisation or energy efficiency and includes wind, electricity transmission and distribution networks.

In March 2022, Actis pledged to ensure all its assets were aligned with net zero as defined by the Paris Initiative by 2050, and became a signatory to Net Zero Asset Managers initiative.