LSEG survey finds 30% of asset owners divesting high-carbon assets

Thirty percent of asset owners surveyed by LSEG say they are pursuing divestment from high-carbon assets, up from 21% in 2025. The share still pursuing engagement with those companies fell to 60% from 67%. Engagement remains twice as common as divestment, but the two measures moved in opposite directions, according to ESG Dive.

Climate risk now shapes how 52% of respondents spread money across asset classes, up from 36% in 2025, the widest increase among the year-over-year comparisons ESG Dive reported.

ESG Dive reported that the survey's measure of engagement had fallen from 86% in 2022 to 74% in 2023 and 71% in 2024. Lee Clements, head of applied sustainable investment research at FTSE Russell, LSEG's index provider, attributed the decline to geopolitical backlash and revisions to sustainability investment and disclosure regulation in emailed comments to the outlet.

Governance, tax and shareholder rights were the most commonly cited sustainability priority among asset owners surveyed by LSEG, named by 32% of respondents, up from 18% in 2025. Clements linked that rise to pressure on shareholder rights and to potential regulatory proposals that could limit disclosure and investors' ability to bring items to a vote.

Forty-seven percent of respondents said they pursue sustainable investment to improve portfolio returns, up from 41% in 2025, while the share citing concern about financial performance fell to 19% from 27%. Clements also pointed to more tangible evidence of sustainability considerations at work, citing extreme heat events over the summer and the current energy shock's effect on the energy transition. Respondents flagged newer risks alongside those themes: 25% named health and healthcare, 24% technology and AI, and 19% food security.

LSEG surveyed 402 asset owners in 24 countries — 40% in Europe, the Middle East and Africa, and 30% each in North America and Asia Pacific. Respondents were senior members of sustainability, investment or management teams at pension funds, insurers, government or sovereign wealth funds, and endowments or foundations. Twenty-two percent manage $100 billion or more, 48% manage $1 billion to $100 billion, and 30% manage less than $1 billion.

This publication reported on 19 October that a FTSE Russell survey found 84% of asset owners say they incorporate sustainability into investment decisions, with 86% rating climate risk at seven or higher out of ten, up from 50% in 2023. Climate index providers have moved to pricing that in tracking-error terms — Scientific Climate Indices pairs a 15% cut in physical risk with one point of tracking error, as this publication reported last month.