Portugal, Institutional
Change
Introduction
At Wellington Management, we believe that material climate risks and opportunities can affect the long-term value of the assets in which we invest; therefore, it is in our clients’ best interests for us to analyze and consider these issues as part of our investment mosaic. As active investment managers, we view the analysis and integration of material climate considerations as both return-enhancing and risk-mitigating. We approach climate integration in accordance with each team’s investment philosophy and process (P&P).
For more information about Wellington Management’s approach to climate integration and how we support our clients’ climate goals, please refer to the Climate section of our Reports and Policies.
NZAM Commitment
Wellington’s European and UK entities, Wellington Management Europe GmbH and Wellington Management International Limited (collectively referred to below as “we” or “our”) are signatories to the Net Zero Asset Managers initiative (NZAM). This document outlines our approach to meeting our NZAM commitment.
This framework is intended to be a guide and practice may evolve.
Commitment 1: Provide clients with information on climate-related risks and opportunities
We are committed to helping clients understand the potentially financially material impacts of climate change and extreme weather on investment performance and risk management. Wellington Management’s collaborations with climate science organizations support robust internal dialogue that is translated into investable insights by our investment personnel and shared with clients. Specifically, and as appropriate, we provide information on the risks and opportunities associated with the low-carbon transition via client meetings, webinars, white papers, regular reporting, and other forms of client communication.
Commitment 2: Support our clients to deliver on their climate goals
We have years of experience working with clients to understand their climate-change policies, strike the right balance between climate and financial objectives, and deliver high-integrity implementation. This work includes developing new investment strategies for clients who are interested in net zero-aligned asset management and providing our investment teams with tools to successfully meet client-defined investment guidelines.
We will continue to work in partnership with clients who ask us to implement decarbonization objectives into new and existing portfolios we manage on their behalf.
Commitment 3: Set near-term climate targets consistent with the global goal of net zero greenhouse gas emissions
Definition of net zero AUM
Our near-term climate target is a composite of mandates managed on behalf of clients contracted with the underlying entities who have requested implementation of their decarbonization goal, consistent with the long-term goal of achieving net zero emissions. This includes: 1) client mandates that set glidepaths using a range of metrics, including increasing portfolio coverage of science-based targets and reducing portfolio carbon footprint; 2) client mandates in investment strategies with the majority of investments in climate solutions, and 3) client mandates that set expectations for engagement activity to encourage portfolio alignment over time.
As of 31 December 2025, these mandates comprised US$14 billion, or 16% of our Europe and UK entities’ AUM. Assets contracted outside of our Europe and UK entities are not included in our near-term climate target.1
Review our near-term climate target periodically to reflect evolving financial risks, client expectations, and practices
In practice, we expect to update this target annually. AUM can fluctuate for many reasons, including net client growth, investment performance, methodology for inclusion of mandates, and client direction.
Commitment 4: Implement an investment stewardship strategy to support investee preparedness
We apply Wellington Management’s Proxy voting policy and procedures, Proxy voting guidelines, and Engagement policy. We act as an independent fiduciary to our clients and sets our own proxy voting and engagement guidance based on the overarching fiduciary duties we owe to our clients. Please refer to our engagement approach and voting guidelines here.
Each investment team is responsible for considering climate-risk management within its portfolios, using its individual philosophy and process to guide the extent — if at all — to which climate research impacts its investment decisions. Investment personnel may engage on the topic of climate when we believe doing so could be financially material to an investment team’s holdings. We rely on constructive dialogue with company management teams and boards to assess companies’ and issuers’ credibility on climate-risk management.
The same stewardship approach (described above) is applied to client mandates included in the near-term climate target unless additional stewardship expectations have been defined by the client. In such cases, the investment team undertakes a review process to ensure that the client expectation is consistent with the investment team’s existing philosophy and process.
Commitment 5: Engage with key actors in the investment system to encourage the availability of products and services that appropriately reflect climate-related risks and opportunities
We follow the overall Wellington Management approach to engagement with the investment ecosystem, which generally focuses on data providers. MSCI, Sustainalytics, and Bloomberg are the primary providers of sustainability-related data.
Wellington Management has systematic data-quality checks and validation rules in place for data sourced to measure the environmental and/or social characteristics of issuers. We collect and use third-party vendor data to screen securities on a pre-trade and post-trade basis through our guideline-monitoring system. During this process, we run the data through systematic data-quality checks. These rules check for consistency, timeliness, and conformity. Processes and governance are in place to remediate detected data-quality issues, and we continuously evaluate our processes to improve these checks.
Our oversight processes are proportionate to the relationship. For example, oversight of the MSCI relationship is led by our Data Product Strategy Team, with regular input from our Climate Research Team. Through monthly meetings and other ad-hoc communication, we provide regular feedback and suggestions to MSCI on how to make their data offerings more useful to investors.
Commitment 6: Ensure relevant policy advocacy we undertake does not undermine commitment
We follow the overall Wellington Management approach to policy advocacy. Relevant advocacy generally focuses on supporting standardized climate and sustainability disclosures from issuers and other regulated entities. This focus addresses a critical issue: the need for consistent, comparable data on sustainability topics most relevant to financial outcomes. Accurate, comparable information is essential to our ability to make informed investment decisions on behalf of clients.
Such policy advocacy takes place in several forms, including contributing to public consultations (by submitting an independent response or by providing feedback to a collated industry association response) and engaging directly with regulators. Where possible, we leverage similar language in these responses to encourage interoperability across jurisdictions.
Commitment 7: Publicly disclose a plan for implementing these commitments and report annually actions and outcomes achieved
Actions taken related to the six commitments above will be tracked and reported annually via Wellington Management’s firmwide Climate Report, Wellington Management International Limited’s Climate Risk Report, and additional reporting as appropriate.
As a signatory, we act independently. We do not form groups, act in concert, or make any collective investment decisions with other signatories. Nor do we ask, encourage, or allow other signatories to represent our views or speak on our behalf. We do not allow any of these commitments to infringe on or limit our legal duties to our clients, nor do we allow these commitments to supersede the investment philosophy and process of Wellington Management’s individual investment teams.
1This target is under review by the NZAM Network Partners.