Aviva Investors has said it will hold boards and individual directors accountable for failing to make good climate and environmental pledges.
In a letter sent to the chairs of companies it invests in, the UK investment major set out its stewardship priorities for the year, which includes companies adopting a target for net zero emissions by 2050 and committing to the Science-based Targets initiative (SBTi).
Aviva Investors, which has £262 billion worth of assets under management, also expects companies to “clearly articulate” climate strategies and transition pathways that will deliver net zero emissions by the middle of the century, with climate plans integrating biodiversity impacts and associated mitigation strategies.
In addition, they must publish a transition roadmap, including short and medium term climate goals and milestones and report on progress using the Taskforce on Climate-related Financial Disclosures framework (TCFD) and consider the option of providing investors with an advisory vote on the report.
The investment fund also want executive pay to be linked to sustainability goals, with companies integrating “robust and measurable strategic and operational” sustainability targets” into variable incentive plans.
Mark Versey, Chief Executive Officer, Aviva Investors said: “We acknowledge the magnitude of these challenges and will evaluate companies on the strength of their commitments and ability to demonstrate progress over time.
“However, we will hold boards and individual directors accountable where the pace of change does not reflect the urgency required.”