Raj Shant on Rethinking the Energy Transition
In this Focus guide, Shant discusses why investing in fossil fuels is not necessarily a binary choice.
REDEFINE THE PATH TO A LOW-CARBON FUTURE
PGIM Jennison Carbon Solutions Equity Fund
EXPANDING THE DECARBONISATION OPPORTUNITY
Most carbon solutions strategies focus on operational emissions via scopes 1, 2 and 3 of the greenhouse gas protocol, overlooking avoided emissions, or scope 4, in the process. In this video, Raj Shant, Client Portfolio Manager at Jennison Associates, explains why he sees scope 4 as an essential contributor to carbon reduction that opens access to a greatly expanded opportunity set to investors willing to recognise it.
A MULTI-DECADE, MULTI-TRILLION OPPORTUNITY
As public sentiment, government regulations and technology advance the transition to a lower-carbon economy, decarbonisation will ultimately be a decades-long, society-shaping undertaking. Appreciating the magnitude of the related investment opportunity requires a focus that goes far beyond ‘green’ solutions alone. A comprehensive approach that recognises the myriad changes required at all levels of global commerce expands the opportunity set dramatically around what is conservatively estimated to be a $2.5 trillion movement.*
PILLARS OF DISRUPTIVE CHANGE AND GROWTH
From rethinking basic materials to cutting-edge technology, ongoing carbon reduction efforts are poised to upend industries and inspire motivation on a level that remains largely underappreciated. Explore the areas we believe are best positioned to benefit from central roles in the new decarbonisation economy.
A HOLISTIC ALPHA-BASED CARBON SOLUTIONS APPROACH
The PGIM JENNISON CARBON SOLUTIONS EQUITY FUND takes a differentiated, comprehensive alpha-based approach to decarbonisation with a concentrated portfolio of 45-65 companies. With a global all-cap multi-sector universe, the fund seeks to invest across a broad range of companies, particularly where the contribution to decarbonisation and likely future growth are being underestimated. Key reasons to invest in the fund include:
APPLYING A GENERATION'S WORTH OF INVESTMENT EXCELLENCE
Founded more than 50 years ago, Jennison Associates, PGIM’s fundamental equity manager, maintains a performance-driven culture marked by exhaustive research, collaboration and a time-tested investment approach emphasising the power of individual-company fundamentals. Jennison manages $214 billion in AUM, roughly $5 billion of which across utilities, natural resources, and infrastructure assets.
RELATED INSIGHTS
Fueling the Future: Broaden Your Decarbonisation Scope
PGIM’s recent Megatrends report reinforces Jennison’s “all-of-the above” approach to the decarbonisation investment opportunity.
Decarbonisation Requires Balancing Energy Realities With Ambitions
The multi-decade energy transition demands pragmatic pathways and investment opportunities abound for alpha generating potential.
Leaving Traditional Decarbonisation Strategies in the Coal Dust
Raj Shant explores the PGIM Jennison Carbon Solutions Equity Fund’s broad-based decarbonisation investment strategy.
Debunking the Fossil Fuel Myth
In this video, Jennison Associates’ Raj Shant argues that a gradual phase out of fossil fuels is a more pragmatic approach to reducing carbon emissions.
*Source for $2.5 trillion decarbonization economy: Princeton Net Zero America Report, December 2020
Sources of data (unless otherwise noted) are as of 9/30/2024.
References to specific securities and their issuers are for illustrative purposes only and are not intended and should not be interpreted as recommendations to purchase or sell such securities. The securities referenced may or may not be held in the portfolio at the time of publication and, if such securities are held, no representation is being made that such securities will continue to be held.
The views expressed herein are those of PGIM investment professionals at the time the comments were made, may not be reflective of their current opinions, and are subject to change without notice. Neither the information contained herein nor any opinion expressed shall be construed to constitute investment advice or an offer to sell or a solicitation to buy any securities mentioned herein. Neither PFI, its affiliates, nor their licensed sales professionals render tax or legal advice. Clients should consult with their attorney, accountant, and/or tax professional for advice concerning their particular situation. Certain information in this commentary has been obtained from sources believed to be reliable as of the date presented; however, we cannot guarantee the accuracy of such information, assure its completeness, or warrant such information will not be changed. The information contained herein is current as of the date of issuance (or such earlier date as referenced herein) and is subject to change without notice. The manager has no obligation to update any or all such information; nor do we make any express or implied warranties or representations as to the completeness or accuracy.
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