A simple premise underlies Terra Alpha’s approach to investing: our economy must operate within Earth’s physical boundaries in order to sustain opportunity and prosperity for generations to come.
We support rapid decarbonization of the global economy, and we committed to the Net Zero Asset Managers initiative in March 2021.
Our understanding of “net zero” means we advocate for:
- Reducing greenhouse gas emissions as far as possible, as rapidly as possible,
- Prioritizing immediate emissions reductions over postponed action, and
- Minimizing reliance on carbon removal technologies and carbon offsets.
As an active investor in public equities, we believe the following are the most impactful means by which we can contribute to decarbonization: our investment decisions and portfolio construction, direct engagement with our portfolio companies, and thought leadership and transparent reporting.
Therefore, our commitments as a Net Zero Asset Manager are to:
- Manage 100% of our AUM in line with net zero emissions by 2050 or sooner
(We emphasize reducing rather than offsetting emissions, and sooner rather than later)
- Achieve 75% Science Based Targets portfolio coverage by 2025
(Measured as the percentage of value invested in companies with emissions reductions targets formally approved by the Science Based Targets initiative, SBTi)
- Actively engage with our portfolio companies to advocate that they:
- Include material Scope 3 emissions in their strategies,
- Verify their targets with SBTi, and
- Establish climate action plans for real results – including, for example, OpEx/CapEx requirements and management incentives to achieve real emissions reductions.
We are proud of our work to date and these new commitments that aim to mitigate the worst impacts of climate change. We thank all of our investors and collaborators for their shared commitment to a sustainable world.
For more on our approach to Net Zero investing, read our latest publication, Our Commitment to a Net Zero Emissions Portfolio.
For more information on our investment strategies, please contact us at invest@terraalphainvestments.com.