Allianz CEO Singles Out Sovereign Wealth Funds in Climate Debate

(Bloomberg) --

Some of the world’s largest asset owners have committed to carbon-neutral investment portfolios by 2050. Now one of them has called on sovereign wealth funds to follow suit.

“The most amazing thing is that the sovereign wealth funds,” often owned by countries with “huge carbon issues,” haven’t yet signed up, Allianz SE Chief Executive Officer Oliver Baete said at the World Economic Forum in Davos on Tuesday.

Climate change has become a major talking point at Davos this year, where activists including Greta Thunberg are joining top executives and lawmakers from around the world. Baete, whose company is part of a group of insurers and pension funds that have promised to move away from carbon-heavy investments as part of the so-called Net-Zero Asset Owner Alliance, cited Norway, which has one of the largest sovereign funds, as one of the nations that should take action.

“They make all their money with fossil,” Baete said on a panel that included Thunberg. “So we could mobilize trillions and trillions more into the right direction.”

Norway’s wealth fund doesn’t have a carbon-neutrality goal, but invests according to a strict set of ethical guidelines spanning from a ban on tobacco to exclusions for unacceptable emissions. The fund, built from decades of income from petroleum production, has also been instructed by the government to cut practically all its exposure to coal.

The fund didn’t immediately answer calls seeking comment.

--With assistance from Mikael Holter.

To contact the reporter on this story: Stephan Kahl in Frankfurt at skahl@bloomberg.net

To contact the editors responsible for this story: Daniel Schaefer at dschaefer36@bloomberg.net, Christian Baumgaertel, Dale Crofts

©2020 Bloomberg L.P.