Amundi, BNP Paribas AM Win €1.6 Billion Sustainable Investment Mandates from Ircantec

French pension plan Ircantec announced that it has selected European asset managers Amundi and BNP Paribas Asset Management (BNPP AM) to manage nearly €1.6 billion of decarbonization-focused equity index mandates.

Ircantec is a French complementary pension scheme with more than €17 billion (USD $18.4 billion) invested in the financial markets. The organization announced a series of commitments in 2021 aimed at ensuring that its reserves are on course to ensure emissions reductions compatible with a 1.5°C scenario. Ircantec’s sustainable investment initiatives include a strategy to phase out fossil fuels by 2030, and a target of reducing emissions from its portfolio of companies by 7% per year on average until 2050.

The newly awarded mandates, each spanning 7 years, include two European equity index funds with nearly €400 million each, allocated to Amundi and BNPP AM, as well as an €800 million global equity index fund allocated solely to Amundi.

Each of the mandates will utilize a customized MSCI SRI index incorporating Ircantec’s SRI charter and climate objectives, including its requirements for 7% annual portfolio decarbonization, a carbon footprint 50% below the benchmark at any given time, and exposure at least equivalent to that of the benchmark to high-impact sectors.

In addition, Ircantec signaled that it “intends to fully exercise its rights as a shareholder,” with Amundi and BNPP AM required to follow its voting policy and to conduct regular engagement with portfolio companies on ESG issues.

In a post announcing the awards, Ircantec said:

“This award illustrates Ircantec’s desire to select management companies capable of combining index management, extra-financial requirements and support for economic, environmental and social transitions.”