GSAM to exit Climate Action 100+

Goldman Sachs Asset Management (GSAM) is to leave the collaborative investor engagement initiative, Climate Action 100+ (CA100+).

The asset manager is the latest in a string of US investment firms to exit the coalition.

Earlier this year news broke about major players such as JP Morgan Asset Management (JPMAM) and State Street Global Advisors (SSGA) leaving, along with  BlackRock’s US-based arm. 

Invesco has also left this year, with firms such as Aristotle Credit and Aristotle Pacific Capital, Vert Asset Management and Mellon Investment Corp reportedly leaving CA100+ in recent weeks.

GSAM confirmed its plans to exit CA100+ in a statement seen by IPE.

“We’ve made investments in our ability to meet the sustainable-investing needs of our clients and remain committed to leveraging our global capabilities,” said a GSAM spokesperson.

The exits of the US asset managers come amid intense politicisation of the consideration of ESG matters in investment in parts of the US, with Republican heads of the US Judiciary Committee having written to over 130 companies demanding information on their CA100+ membership.

The letters, which described the CA100+ as a “woke ESG cartel”, alleged that involvement in the group could potentially violate US antitrust laws.

Letters were sent to numerous CA100+ members, including the California State Teachers’ Retirement System (CalSTRS), GSAM and Franklin Templeton Investments.

CA100+ asset owner support

Earlier this summer, in the wake of some of the high-profile asset manager exits, some US pension funds drafted a statement intended to show continued strong support for CA100+. As of the beginning of last month, a group of about 63 asset owners representing around €5.5trn had signed it.

This statement was drafted by US pension funds, CalSTRS, California Public Employees’ Retirement System (CalPERS), the New York City Comptroller Office, the New York State Common Retirement Fund, and Wespath Benefits and Investments.

Speaking to IPE, Aeisha Mastagni, senior portfolio manager on the sustainable investment and stewardship strategies team at CalSTRS, said: “Wespath approached us and then we talked to a few New York funds along with CalPERS.”

“There was a lot of media attention on the exits and this statement shows there is still wide support for Climate Action 100+ as a tool for engagement,” she told IPE.

Reacting to those same high-profile member exits earlier this year, Climate Action 100+ had said that the initiative’s terms of participating “do not set any formal, legal or contractual requirements or obligations upon an investor’s engagement activity” and that the fundamental principle that underpinned the collaborative initiative was that “climate risk is financial risk”.

Additional reporting by Susanna Rust