Schroders launches Carbon Offset Share Classes

Schroders today announces the launch of Carbon Offset share classes. This innovation will provide clients with the choice to offset carbon emissions associated with their underlying fund holdings. 

These share classes will be available as part of the Schroder International Selection Fund (SISF) Global Climate Leaders, focused on investing in companies which evidence ‘climate change leadership’. The fund is managed by Simon Webber and Isabella Hervey-Bathurst.

Schroders will aim to ensure that the offsets purchased will equate to the Scope 1 and 2^[1] emissions of the portfolio companies attributable to the share class. For example, if the share class holds 1% of a company, Schroders will calculate 1/100th of that company’s Scope 1 and 2 carbon emissions. Adding together all of the equivalent exposures to carbon emissions, yields an estimate of the total carbon emissions attributable to the share class.

All the offsets are linked to high quality offset projects² with details of each project to be provided to investors via Schroders’ website. Investors will be given full transparency on the offset costs³.

Andy Howard, Schroders’ Global Head of Sustainable Investment, said: ​
​“As a global investor, Schroders has a fundamental role to play in decarbonising the economy and our commitment to climate action goes back decades. We have accelerated investment in our own internal capabilities to help us measure and manage climate risks and are focused on pushing companies to transition. ​
​“The next stage is to directly support our investors on this journey with these newly-launched carbon offsetting share classes. We are committed to innovating and delivering sustainable investment solutions for our investors and today’s announcement is further evidence of this key priority.”

Simon Webber, Portfolio Manager of the Schroder ISF Global Climate Leaders, said: ​
​“Achieving the goals of the Paris agreement requires a massive step change in the pace of emissions reduction globally. This fund aims to invest in those companies at the very forefront of making the necessary emission reductions. It was therefore a natural evolution for us to broaden this focus directly to our investors in the strategy through these pioneering share classes.”

Schroders’ commitment to reducing greenhouse gas emissions was last year formally validated by the Science Based Targets initiative.

¹ Scope 1 emissions are direct emissions from sources owned or controlled by the company, while Scope 2 emissions are indirect emissions from the consumption of purchased electricity, heat or steam.

² All carbon credits issued from any of the major carbon standards (e.g. Gold Standard, VCS, ACR) will have undergone a robust verification process by an ISO accredited third-party verifier.

³ The calculation of carbon offset costs will be performed at least quarterly.

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