MARKET COMMENTARY

Franklin Templeton and Fiduciary Trust Join Net Zero Asset Managers Initiative

07.14.2021 - Ronald J. Sanchez, Chief Investment Officer

On July 6, 2021, Franklin Templeton announced that our organization joined the industry-leading Net Zero Asset Managers Initiative (NZAMI). This initiative represents the efforts of an international group of asset managers committed at the CEO level to supporting the goal of net zero greenhouse gas emissions by 2050 or sooner. As a subsidiary of Franklin Templeton, we are dedicated to making this initiative a success.

NZAMI currently has 128 signatories who have $43 trillion in assets under management, a clear sign of the asset management industry’s recognition that climate change is an urgent priority that must be addressed. Franklin Templeton is a valuable partner to this initiative and has committed to finding the data and solutions to help achieve net zero emissions by 2050, in line with global efforts to limit warming to 1.5 degrees Celsius.

Managing Portfolio Risk

We acknowledge climate change as a risk to portfolios and we are committed to helping our clients understand the impact to portfolios caused by global warming and navigating the changing landscape to net zero.

This initiative is fully aligned with how Fiduciary Trust International currently manages client portfolios. Our managed equity process uses an integrated research process that blends traditional financial analysis with the evaluation of environmental, social, and governance factors (“ESG”). We believe firms that can identify and adapt to material ESG risks and opportunities improve their chances of generating superior financial performance over the long-term.

Our Role as a Fiduciary

Though we recognize the risks of climate change and are excited to have more data and tools to analyze companies, we also recognize that clients have a range of investment objectives and level of interest in this mandate. Of course, we will continue to manage investments in accordance with clients’ wishes, trust documents and investment mandates.

For these reasons, Franklin Templeton’s Stewardship and Sustainability Council and the Global Sustainability Strategy Team have identified climate change as a strategic priority for the firm and will be implementing this important agenda for change throughout the organization. Together with our colleagues across the organization, we will work toward this goal in a spirit of authentic engagement and partnership with our clients and stakeholders. This will be in keeping with our belief that good stewardship as a global asset manager means managing and allocating capital to benefit our clients across generations.

Developing a Roadmap

To make this commitment a success, over the next twelve months we will develop a roadmap to achieve net zero emissions by 2050. We will review our interim target at least every five years and Portfolio Managers will provide asset owner clients with information and analytics on net zero investing and climate risk and opportunity.

Vice Chair of Fiduciary Trust International, Lisette Cooper, is a member of Franklin Templeton’s Stewardship and Sustainability Council. In this role she will work with investment leaders and clients on developing a stewardship process.

Importantly, each asset class and each client portfolio are likely to have a different pathway to net zero emissions by 2050, or sooner.

Net zero is an ambitious goal, and this is a milestone for us as a leader in the wealth management industry, a step forward in a journey that we have already embarked upon. Please click here to read Franklin Templeton’s press release announcing its commitment to the Net Zero Asset Managers Initiative.

 

 

 

 

 





This communication is intended solely to provide general information. The information and opinions stated may change without notice. The information and opinions do not represent a complete analysis of every material fact regarding any market, industry, sector or security. Statements of fact have been obtained from sources deemed reliable, but no representation is made as to their completeness or accuracy. The opinions expressed are not intended as individual investment, tax or estate planning advice or as a recommendation of any particular security, strategy or investment product. Please consult your personal advisor to determine whether this information may be appropriate for you. This information is provided solely for insight into our general management philosophy and process. Historical performance does not guarantee future results and results may differ over future time periods.

IRS Circular 230 Notice: Pursuant to relevant U.S. Treasury regulations, we inform you that any tax advice contained in this communication is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein. You should seek advice based on your particular circumstances from your tax advisor.

MARKET COMMENTARY

Too Much of a Good Thing: Overcoming Concentrated Portfolio Risk

07.28.2021 Jon Heckscher

Too Much of a Good Thing: Overcoming Concentrated Portfolio RiskNEXT POST

MARKET COMMENTARY

Should the Fed Stay or Should They Go?

07.07.2021 Douglas Cohen, Portfolio Manager

Should the Fed Stay or Should They Go?PREVIOUS POST