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JPMorgan’s $2.5tn asset management arm has left Climate Action 100+, an investor group that prods companies into action on global warming, saying its division now has the capacity to do corporate climate engagement on its own.
The New York firm becomes the latest big US fund manager to quit an environmental investing coalition at a time when the industry is under intense pressure from US Republicans over efforts to reduce carbon emissions.
Launched in December 2017, Climate Action 100+ challenges airlines, oil majors and other polluting companies to reduce their carbon footprint. JPMAM joined in 2020, as did BlackRock, State Street Global Advisors and a number of other very large US firms.
JPMAM “is not renewing its membership in Climate Action 100+”, a spokesperson for the firm said in a statement to the Financial Times. The firm has made a “significant investment” in its stewardship team and corporate engagement “as well as the development of its own climate risk engagement framework over the past couple of years”.
“The firm has built a team of 40 dedicated sustainable investing professionals,” she said. “Given these strengths and the evolution of its own stewardship capabilities, JPMAM has determined that it will no longer participate in Climate Action 100+ engagements.”
JPMorgan’s departure shrinks the number of very large asset managers in Climate Action 100+, and comes after several smaller fund houses, including Loomis Sayles and Walter Scott, left the group last year. Vanguard and Fidelity never joined the group, which has more than 700 members. BlackRock, Goldman Sachs, Invesco and Pimco remain listed on the organisation’s website.
A Climate Action 100+ representative declined to comment on JPMorgan’s move, but said only 13 firms have left the organisation since it launched and about 60 have joined since June 2023.
As asset managers have benefited from a global boom in sustainable investing, they have also been targeted in by Republicans who are typically aligned with the oil and gas industry. In 2022, West Virginia led the way when it barred five financial firms, including JPMorgan, BlackRock and Goldman, from new state business, saying they were “boycotting” the fossil fuel industry.
The US House judiciary committee subpoenaed BlackRock, State Street Global Advisors and Vanguard as part of an investigation into sustainable investing. The committee has also subpoenaed an official at Climate Action 100+.
Vanguard left the Net Zero Asset Managers initiative in December 2022, days before its representative was scheduled to testify at a Texas legislative hearing about sustainable investing alongside BlackRock and SSGA. Vanguard was ultimately excused from the hearing.
Texas, the leading US oil-producing state, has declared Climate Action 100+ to be anti-oil and blocked financial companies, including BlackRock, from doing business with the government.
Oklahoma, another oil producer, banned JPMorgan, BlackRock and others from doing business with the state in 2023.
Additionally, 21 Republican state attorneys-general are investigating asset managers for working together on climate issues. “Potential unlawful co-ordination appears throughout Climate Action 100+’s documents,” the attorneys-general said last year.
JPMorgan’s most recent climate change engagement report lays out its views on the limits of collective action, saying that it “does not work in concert with other investors on investment matters and makes its own independent decisions concerning investee companies”.
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