The largest European asset managers are less carbon-intensive than their U.S. peers, according to MSCI research.
MSCI also found that the largest firms by assets under management had larger financed emissions, particularly among the U.S. fund managers studied, said Rumi Mahmood, vice president of MSCI research, in a blog post Monday.
The blog post, Footprinting the World's Largest Asset Managers, looked at the ETF and mutual fund assets of the 10 largest asset managers globally by AUM, using data from MSCI's Climate Lab Enterprise.
Those top 10 managers — seven in the U.S. and three in Europe — had more than $25 trillion in assets and represented nearly 25% of investments funds globally as of Sept. 30.
Emissions metrics were based on those firms' equity and debt holdings across funds.
On carbon intensity as measured by Scope 1 and 2 emissions, the U.S. firms were close to 200 tons of carbon dioxide per dollar, while European fund managers were clustered around or below 150 tons of CO2 per dollar, MSCI found.
For the U.S. managers, each $1 trillion invested led to an extra 10 to 20 tons of CO2, MSCI found.
"With a larger breadth of fund offerings across geographies and sectors, the larger fund providers exhibited higher financed emissions," Mr. Mahmood said.
European fund providers generally had more strategies focusing on European companies, "which were often better positioned versus their non-European peers in addressing environmental risks," he said in the post.
Mr. Mahmood also cited a Net Zero Asset Managers initiative report that found European asset managers in general have a higher initial percentage of AUM managed in line with net-zero goals, at 20% to 35% for European managers compared with 10% to 25% for U.S. managers.
Nine of the 10 largest asset managers studied are signatories to the Net Zero Asset Managers initiative, where they commit to setting interim targets for the proportion of assets to be managed in line with attaining net-zero emissions by 2050, and to review the target at least every five years with the ultimate goal of including 100% of AUM.
