AXA Investment Managers is now including environmental, social and governance (ESG) targets in determining the remuneration of its senior executives, the firm says, adding that the move is part of its commitment to become net zero as a business and investor by 2050.
From this year, the deferred compensation of about 400 people that will start to be paid in 2024 will include, alongside existing criteria, ESG metrics according to their business area and remit.
Among these metrics is for the weighted average carbon intensity to reach the target of 25% reduction in carbon intensity for corporate portfolio by 2025.
Another target is for 50% of the real estate portfolio to be aligned with the CREEM trajectories by 2025. CREEM refers to carbon risk real estate monitor, a specific tool for the real estate sector which projects a science-based pathway for real estate assets based on their sector and geography.
A third metric is for the corporate operational carbon dioxide footprint to be reduced by 26% by 2025.
The new policy is reflected in the AXA IM for Progress Monitor, a set of metrics selected due to their material contribution towards the firm’s ambition to become a leading responsible asset manager. AXA IM says the metrics sit alongside its financial targets and indicators as additional indications of its progress as an investor and a business.
Progress towards these targets will be reported annually from 2023. “As we further put sustainability at the heart of everything we do, we believe transparency and regular reporting on our progress and the challenges we may face are crucial,” says AXA IM executive chairman Marco Morelli. “We are choosing to visibly position our non-financial targets alongside our financial ones and to increasingly onboard our organization to make our employees a part of our sustainability journey.”