Bridging the gap in sustainable finance

Asset manager Amundi guides investors to capture energy transition opportunities

The first-ever global stocktake, released by the United Nations in October 2023, revealed that global carbon emissions have exceeded interim targets required to meet the 2050 objective of the Paris Agreement.

This lag represents both a risk for investors as well as an opportunity, said Sylvia Chen, Amundi's head of environmental, social and corporate governance (ESG) for South Asia.

Annual global clean energy spending has to rise from US$1.8 trillion in 2023 to US$4.5 trillion by 2030, according to an International Energy Agency (IEA) study.

This spending will create demand for products, services and financing, which Amundi is helping its investors meet. As the largest European asset manager, Amundi sees its role in "not only financing the world as it is today, but also, helping finance the world as it should be", said Albert Tse, chief executive of Amundi for South Asia.

Chen highlighted five green tech trends to watch in 2024: sodium batteries, artificial intelligence for smart emissions management, green steel, carbon capture and storage, and alternative marine fuels.

ASIA'S POTENTIAL AND DUAL CHALLENGE

Asia, led by China, is at the forefront of the movement towards sustainable development, heavily investing in green technologies.

IEA data shows Asian countries account for approximately 70 per cent of the US$470 billion global investment in clean energy technologies.

In its Asia Responsible Investment Views 2024 report, the asset manager said "technological advantages, coupled with Asia's manufacturing prowess, not only fuel the region's progress but also engender a growing dependency from European and American green technology supply chains".

The region's needs are huge.