AIGCC expands investor work in China with launch of new working group

24 April 2023
Investors are increasingly seeking to reduce their exposure to climate risks and better position themselves for the opportunities worth trillions of dollars that will be created by China’s commitment to carbon neutrality.

The Asia Investor Group on Climate Change (AIGCC) has launched a new China working group to meet the growing interest from investors who invest in the China market. This brings AIGCC’s total number of working groups to seven.

China requires a significant amount of investment to reach its dual-carbon targets of peak carbon use by 2030 and carbon neutrality by 2060. Highly-competitive low-carbon energy options, such as wind and solar, are already deployed at scale in China.

Qimin Chai, Director of the Strategic Planning, National Centre for Climate Change Strategy and International Cooperation (NCSC), from China’s Ministry of Ecology and Environment, spoke at the inaugural meeting of the working group on 24 April 2023. He reiterated, “To achieve China’s 2060 Carbon Neutrality goal, over 139 trillion RMB (21 trillion USD) investment will be needed, with a long-term funding gap of 1.6 trillion RMB (232 billion USD) per year.”

The launch and development of major policies in China, such as the China Emissions Trading System (ETS) and the China-EU Common Ground Taxonomy-Climate Change Mitigation (CGT) have contributed to the growing urgency among investors on climate change and ESG investing. Investors are keen to provide input into these processes as they continue to develop towards implementation.

Rebecca Mikula-Wright, CEO, AIGCC said: “Investors are increasingly seeking to reduce their exposure to climate risks and better position themselves for the opportunities worth trillions of dollars that will be created by China’s commitment to carbon neutrality.

“AIGCC is best positioned to support China’s dual-carbon targets by leveraging our experience in the region and connection with climate-aligned investors and international investor networks. We are able to support domestic investors as they decarbonise their portfolios through existing frameworks, such as the Investor Climate Action Plans (ICAPs) and the Net Zero Investment Framework (NZIF).

“Leadership from China has already created significant momentum and has placed Asia on track in the transition to net zero.”

Valerie Kwan, Director, Engagement, AIGCC said: “With the global transition to net zero well underway, investors recognise the need to acknowledge market nuances within Asia when net zero plans are being implemented. This is a timely moment for the establishment of the China Working Group, as we have witnessed through Climate Action 100+ and AIGCC’s Asian Utilities Engagement Program that corporate engagement on climate is now being fully recognised as a priority.

“The common goals of markets towards carbon neutrality and differentiated responsibilities in the transition calls for accelerated efforts in the region.

“Through the China Working Group, we are keen to foster an environment for conversations amongst investors with an interest in the developments of climate policy in China and are looking to deepen their engagement in the market.”

AIGCC’s investor-led working groups allow members to participate in setting research and policy objectives for AIGCC while also growing expertise and knowledge in key areas of investor practice.

In the first year of its launch, the China Working Group will be open to Chinese investors who are not currently AIGCC members to encourage an active and dynamic discussion.

The other six existing working groups are: Energy Transition, Engagement and Policy, Forest and Land Use, Japan Working Group (facilitated in Japanese), Paris Aligned Investment, Physical Risk and Resilience.

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Learn more about the working groups