* Also cuts ICBC, PPL Corp, China Mengniu Dairy
* They join nine others on exclusion list
* Will be divested from funds holding 58 bln stg
(Adds comment from Mengniu, paragraphs 12-13)
By Simon Jessop and Elizabeth Howcroft
LONDON, June 15 (Reuters) - Legal & General Investment
Management, Britain's biggest asset manager, said on Tuesday it
would drop four companies from a number of its funds over their
"insufficient" response to the challenge of climate change,
including U.S. insurer AIG.
The others to be divested are Chinese lender Industrial and
Commercial Bank of China, U.S. utility holding
company PPL Corporation and Chinese dairy products
holding company China Mengniu Dairy.
All had either not responded adequately to corporate
engagement or had breached LGIM's "red lines" around involvement
in the coal sector, their carbon disclosures or their links to
deforestation, the money manager said in a statement.
They join nine other companies previously excluded for
similar failings by LGIM, which manages 1.2 trillion pounds
($1.7 trillion) in assets, including U.S. oil major Exxon Mobil
and Korea Electric Power Corporation.
As part of its Climate Impact Pledge launched in 2018, LGIM,
part of insurer Legal & General, said the companies
would be excluded from actively managed funds holding some 58
billion pounds in assets and all four would face voting
sanctions using shares held across its entire equity book.
"We've been making consistent requests for a multi-year
period ... (the companies are) really not meeting what we
consider to be baseline minimum standard expectations in terms
of climate change management across their sectors," said Yasmine
Svan, Senior Sustainability Analyst at LGIM.
The exclusions follow a commitment by LGIM in October to
expand the number of companies it engages with over climate
change to 1,000 from 100.
That push was already starting to bear fruit, LGIM said on
Tuesday, with 22% of the companies on its "priority" list now
setting a target for net-zero carbon emissions.
During the current season for annual general meetings, LGIM
said 130 companies would face votes against for not meeting its
minimum climate change standards, mostly in the banking,
insurance, real estate, tech and telecoms sectors.
As global policymakers gear up for the latest round of
climate talks in Glasgow later this year, LGIM Chief Executive
Michelle Scrimgeour said asset managers also needed to step up.
"Progress cannot be made by acting in isolation and we, as
investors, have a real role to play in the responsible
allocation of capital and acting as stewards to our investee
companies to encourage greater progress to meet our overall
sustainability goals."
Mengniu said that it "proactively supports the goal to
achieve carbon neutrality by 2060, and to lead the industry in
carbon neutrality commitment with regular emission reduction
targets and roadmap disclosure".
"In 2021, Mengniu will complete detailed carbon emission
data accounting of its subsidiaries, formulate carbon emission
reduction action targets and plans, and thus reduce product
carbon footprints," the company said.
($1 = 0.7056 pounds)
(Reporting by Simon Jessop
Editing by Rachel Armstrong and David Evans)
Legal & General (LGEN)
