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Unlocking Opportunities: A Positive Outlook on Net Zero Investments - Insights from the IGCC State of Net Zero Investment 2024 Report


The Investor Group on Climate Change (IGCC) "State of Net Zero Investment 2024" report surveyed a total of 63 investors, which manage over AUD$5 trillion in assets on behalf of Australian beneficiaries. Among these respondents, 22 were asset owners and 41 were asset managers.

There is a growing trend of investors setting interim and long-term climate targets. More investors are committing to net-zero targets by 2050, with an increasing number setting interim targets for 2030 or 2035. These commitments signal a strong demand for decarbonization solutions and carbon credits, fostering growth in these market

Despite global and local headwinds, Australian investors are maintaining strong climate ambition. Key indicators such as climate strategy setting, portfolio climate risk monitoring, and alignment with major international climate reporting standards show a steady upward trend.

Investors are increasingly engaging with companies to ensure they set and meet science-based decarbonisation targets. The report underscores the importance of investor engagement with high-emitting portfolio companies. Time-bound and measurable engagement targets are emphasised as essential for translating long-term climate commitments into near-term actions. Enhanced engagement practices are expected to accelerate industry emission reduction efforts.


This active stewardship drives corporate action on emissions reductions, creating more opportunities for investments in decarbonisation technologies and projects.

The IGCC report highlights a significant interest in climate solutions, with many investors setting targets to increase their investments in this area. This trend is supported by initiatives like the Australian Sustainable Finance Initiative (ASFI), which aims to define and promote investments in climate solutions.

There has been an increase in investor awareness and action regarding biodiversity. The percentage of investors conducting some level of assessment related to biodiversity and nature has risen from 25% in 2022 to 44% this year. However, only 14% of investors have integrated a response to biodiversity risks into their portfolios, indicating room for further improvement.


Deforestation is increasingly recognised as a critical issue that intersects with climate change. Despite its significance, only 27% of investors reported conducting any level of assessment or integrating a response to deforestation risks and opportunities. Additionally, just 14% of respondents are meaningfully engaging with companies to reduce deforestation. Over half (51%) of investors surveyed have not taken any action on deforestation, highlighting a gap in current investment practices and the need for more proactive engagement in this area.

Nearly all investors have integrated climate strategy and portfolio climate risk monitoring at the board level. Moreover, the alignment of climate reporting with major international standards positions investors well for upcoming mandatory disclosures. The report also highlights the necessity for continued enhancement in governance structures to support climate-related accountability.

The report shows a significant reduction in policy and regulatory uncertainty as a barrier to climate investment. This clarity provides a more stable and predictable environment for investors, encouraging long-term investments in decarbonisation, including carbon markets.


Investors identified several key areas that should be prioritised by the government:


  1. Setting 1.5°C Aligned Sector Pathways and Plans: 56% of investors highlighted the importance of developing sector-specific decarbonisation pathways and plans aligned with the 1.5°C target. This strategic planning is critical for guiding investments and ensuring an orderly transition.

  2. Improved Approach to Carbon Pricing: 54% of investors called for a more effective carbon pricing mechanism. This would create clearer incentives for reducing emissions and support the transition to a low-carbon economy.

  3. Greater Funding to Support New Climate Technologies: 53% of respondents emphasised the need for increased government funding for the development and deployment of new climate technologies. Such funding is essential to drive innovation and make emerging technologies commercially viable.

  4. Phasing Out Fossil Fuel Subsidies: 51% of investors believe that eliminating subsidies for fossil fuels is essential. This measure would help level the playing field for renewable energy sources and encourage investments in cleaner technologies.

  5. Public/Private Financing Mechanisms to Unlock Investment in Resilience: 39% of respondents supported the creation of financing mechanisms that combine public and private resources to invest in climate resilience. This approach is seen as vital for enhancing the resilience of infrastructure and communities to climate impacts.

  6. Timelines on the Phase Out of Coal, Oil, and Gas: 39% of investors suggested that clear timelines for phasing out fossil fuels would provide certainty and drive the necessary shifts in energy investments and consumption patterns.



The report underscores a positive outlook for investments in decarbonisation, carbon and environmental markets

  • More investors are committing to net-zero targets by 2050, with an increasing number setting interim targets for 2030 or 2035.

  • These commitments signal a strong demand for decarbonisation solutions, including carbon markets.

  • Investors are increasingly engaging with companies to ensure they set and meet science-based decarbonisation targets.

  • This active stewardship drives corporate action on emissions reductions, creating more opportunities for investments in decarbonisation technologies and projects.

  • Investors are increasingly recognising the need to address climate-related risks, which supports investments in projects that enhance environmental resilience and sustainability.

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