Supporting the transition to a net zero economy

Climate change is one of the most complex and critical challenges facing the world, and the finance sector has a vital role to play in efforts to limit global warming. For almost two decades, Macquarie has worked with governments and clients to drive the energy transition and advance solutions to climate challenges. We are committed to reaching net zero operational emissions by 20251 and aligning our financing activity with the global goal of net zero emissions by 2050. This is consistent with our purpose of empowering people to innovate and invest for a better future.

We have built expertise in investing directly in climate mitigation and adaptation and in supporting our clients and portfolio companies to decarbonise their activities. Our activity spans the supply and financing of renewable energy, including green power PPAs; storage, firming, transmission and distribution solutions; risk and capital solutions in transition, green and lower carbon fuels and metals; asset finance for zero emission transportation, smart meters, energy efficiency and onsite generation; precision agriculture; and carbon offsetting. Our leading advisory business supports clients to raise capital, invest and align their portfolios with the transition to a net zero economy.

In the past year, we have made further progress in partnership with our clients. Our asset management business announced plans to manage its portfolio in line with global net zero emissions by 2040. Our principal investment business is developing over 30GW of new renewable energy projects across four continents. And our commodities and global markets business has created new products to offset the carbon impact of commodities like oil and gas.

As global commitments to tackling climate change accelerate, and in keeping with our culture of innovation and evolution, we are strengthening our own commitment on climate in four key areas.

First, we are strengthening our support for clients and portfolio companies to manage the transition to net zero and achieve their decarbonisation ambitions.

In our asset management business, we have started work with portfolio companies to consistently measure greenhouse gas emissions and identify emission reduction opportunities. Where we have sufficient influence, we will work with these businesses to develop plans that will put them on a pathway to reduce emissions in line with a net zero economy by 2040.

More broadly, we are working with our clients to achieve a managed transition to net zero. We recognise that much of the world will depend on oil and gas to power economies and that until new, commercially viable technologies become available, these fuels will have a continued role in the provision of essential energy. We will continue to support clients in these sectors, and we are engaging with them to design both finance and technology solutions that will help them deliver a managed transition to decarbonise and reduce the emissions intensity of their activities. 

Second, we are increasing our investment in climate mitigation and adaptation solutions.

This builds on our leading position as a global developer, investor, financer, and manager of renewable energy projects. In addition to our leading role in established technologies like wind and solar, we expect to increase investment in important emerging transition opportunities including zero emissions transport, hydrogen, carbon sequestration, nature-based solutions, and climate resilient infrastructure.

Third, we will align the emissions of our financing activities with the objective of enabling and accelerating the world’s pathway to net zero by 2050. As part of this commitment, we will measure and set interim and long-term science-based emissions targets for our financing activities prioritising our efforts on clients and partners in high emission sectors and the role that Macquarie will play in accelerating their pathways to net zero.

We recognise that the financial sector does not currently have fully established methodologies and tools to measure and manage emissions across all types of financing activities and sectors. We will work to expand our approach as industry practice develops and continue to collaborate with our peers to evolve and shape measurement standards.

As previously indicated, we have reduced our limited remaining equity and lending exposures to the coal sector, which are expected to run off by 2024.

Finally, we will continue to reduce the emissions of our own business operations. We have maintained carbon neutrality across our offices, data centres and business air travel since 2010 and, consistent with our 2025 Sustainability Plan, we are committed to reaching net zero operational emissions by 2025, including targets to reduce energy use and meet all of our operational needs from renewable sources.

We will outline more detail in each of these four areas by publishing a Macquarie Net Zero Plan by the end of 2022, and annual progress reports thereafter.

 

  1. Operational emissions include scope 1 and scope 2 emissions, and emissions from business travel.