Ahead of the United Nations Climate Change Conference (COP28) in Dubai, UAE, The Rockefeller Foundation made a significant announcement. The foundation is targeting net zero greenhouse gas (GHG) emissions for its $6 billion endowment by 2050. This move positions it as the largest private U.S. foundation to pursue such a target.
Following other US institutions like Harvard University, which committed in 2020 to reaching net zero emissions for its >$50 billion endowment by the same deadline, Rockefeller’s next step involves driving more significant decarbonization efforts.
The Rockefeller Foundation’s Net Zero Influence
President Rajiv Shah highlighted The Rockefeller Foundation‘s commitment to divesting from fossil fuels 3 years ago. They have pledged $1.5 million to a global initiative that will support developing countries’ transition towards clean energy.
Today, they are focusing on pushing for greater decarbonization through both direct investments and influence.
According to the foundation’s Chief Investment Officer, Chin Lai, the move is more than their endowment. Lai commented noted:
“Because net zero is a collective goal… we will encourage our fund managers to engage with companies on emissions reduction plans, invest in climate solutions, and use our convening power to advance net zero adoption among investors.”
Lai outlined three strategies for Rockefeller to extend its net zero influence.
- First, working with money managers who can have a more significant impact on decarbonization efforts.
- Second, directly investing in companies offering climate change solutions (pledging $1B to climate solutions over the next 5 years).
- Third, establishing benchmarks to measure progress and sharing these with other investors, aiming to encourage wider participation in their efforts.
The 5 Core Guiding Principles
The new strategy centers around maintaining the endowment’s crucial role in providing sustainable funding for The Rockefeller Foundation’s global initiatives. It primarily focuses on engaging with asset managers and other stakeholders on data, disclosures, and decarbonization plans.
Moreover, it emphasizes investments in climate solutions and other climate-focused strategies. The strategy aims to exert influence by organizing influential gatherings, advancing collaboration, setting standards, promoting best practices, and fostering shared learning.
The net zero strategy for the $6 billion endowment rests on five core principles:
- Prioritize Real-World Change: Prioritizing scalable approaches today and technologies expected to scale in the next 15-20 years.
- Be Pragmatic: Recognizing diverse roles in asset classes, investment managers, and vehicles .
- Learn Continuously: Recognizing that there isn’t a single correct method for an investor, fund manager, or company to achieve net zero.
- Maintain Accountability: Promoting transparency at both portfolio and manager levels and committing to regularly share progress to uphold accountability.
- Lead by Example: Organizing crucial stakeholder gatherings and leveraging The Rockefeller Foundation’s influence and voice in the investment industry and philanthropic institutions.
Going Beyond Setting Net Zero Targets
The Foundation’s philanthropic journey traces back to 1913 when it started with an initial endowment of $100 million from John D. Rockefeller, the founder of Standard Oil. It’s a company that once held control over more than 90% of petroleum production in the United States.
Over the past 110 years, the Foundation has invested $26 billion in philanthropic capital. This recent policy continues the Foundation’s commitment, initiated in 2020, to divest its endowment from existing fossil fuel interests.
Additionally, it pledges to abstain from making any future investments in fossil fuels, building upon this ongoing dedication to environmentally responsible investing.
The Rockefeller Foundation’s new net zero endowment policy aligns its internal investment strategy with the commitment to spend over $1 billion to drive the global climate transition. This comprehensive climate strategy, unveiled in September, also involves efforts to achieve a net zero standard for its facilities.
The Foundation’s operational sites, spanning from its headquarters in New York City to locations in Washington, D.C.; Nairobi, Kenya; Bangkok, Thailand; Bellagio, Italy; and other operational areas worldwide, are included in this initiative.
As part of this ongoing effort, The Rockefeller Foundation completed its assessment of the accounting of its carbon footprint for the baseline year of 2022. The evaluation revealed an estimated annual emission of 12,000 metric tons of greenhouse gasses across its operations.
The Foundation’s Roadmap to Net Zero is still in process and will be finalized in early 2024.
- RELATED: IEA’s 2023 Net Zero Roadmap
With that, the Foundation’s goal extends beyond establishing targets and strategies for reducing carbon emissions across Scope 1, 2, and 3. It also aims to collaborate with and support others within its ecosystem by sharing the knowledge gained and the progress made during this journey toward decarbonization.
The Rockefeller Foundation’s 2050 net zero is a milestone in climate-focused philanthropy. Their dedication to transparency, innovation, and accountability is a significant step towards driving systemic change in the fight against climate change.