Environment

Climate change carries risks to investments. Not only can extreme weather events like floods affect companies’ profits, but high-polluting industries are facing increased competition from cleaner, cheaper energy sources.

Through our Climate Impact Pledge, we are encouraging companies to adopt sustainable business models, and are already seeing results, such as:

• Major oil producer Shell adopting ambitious carbon emission targets, and linking them to the pay of their executives
• Xcel Energy planning to become the first major US utility to go 100% carbon-free, pledging to close its coal power plants a decade ahead of schedule
• German automaker Daimler – the inventors of the internal combustion engine – shifting its business towards electric, completely emissions-free driving

We are encouraged by the progress seen, but if companies show signs of inaction, we will vote against the chair of their board to hold them accountable on this era-defining challenge. As a tool of last resort, we may even remove our investments in such companies from some of our funds.

What we're doing for the environment

We are using our voice as a large investor to drive change in the market, but we are also working to set our own house in order. Our activities include:

• investing in renewable energy – including solar energy and the world’s largest onshore wind farm
• ensuring that our property businesses develop energy-efficient homes, on a pathway to net zero emissions-properties by 2050

Read more about our environmental work

• LGIM to divest from four companies on ESG grounds
• ExxonMobil and Chevron suffer shareholder rebellions over climate
• LGIM DC business sets out interim targets for net-zero by 2050 goal
• Beside the G7 seaside | Legal & General (legalandgeneral.com)
• LGIM increases pressure on companies to address climate risk
• COVID-19 and threat of climate change drives increase in LGIM’s company engagements
• The Rebuilding Britain Index: Levelling up our local communities
• Active Ownership Report: responsible investing amid a pandemic
• Rebuilding the economy through our fight against climate change
• L&G Future World ESG Developed Index: Hargreaves Lansdown