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About two-thirds of the GHG reductions achieved by these companies were genuine from the planet’s perspective; much of it came courtesy of efficiency measures or retiring polluting assets. Divestments (8%). 0.124 Retirements and divestments (100%). Divestments (25%). Divestments (3%). Divestments (94%).
This backsliding has increased polarisation between investors, with some choosing to divest and others – in recognition of their responsibility as universal owners – doubling down on engagement with the sector. There is value in engagement, provided it happens over a defined period and there are defined outcomes.
Those organisations that have not considered reducing these emission sources could be misunderstanding the double materiality risks they carry: the risks to their business, like strandedassets or reputational risks, and their contribution to making the Earth uninhabitable.
By divesting its 20% stake in Rosneft, BP also disposed of around a third of its oil supplies. As divestment sceptics know, there’s a big difference between reducing portfolio and real-world CO2 emissions. But will the energy giants diversify from or double down on fossil fuels in response to inevitable write-offs on strandedassets?
This could stem from campaigns which lobby for divestment from polluting companies or projects. “In our view, the risk to investors from ESG or climate litigation remains primarily indirect,” Mark Banks, Dispute Resolution Senior Associate at Baker McKenzie told ESG Investor.
Alignment is not just about divestment, said Bolli, but about a “collaborative mindset” that uses engagement to steer investee companies on the right path. . Only if engagement and voting don’t work would there be a need to divest, given the risk of strandedassets on the balance sheet, she noted. .
Alongside the progress of a bill in California calling for fossil fuel divestment by public-sector pensions, and the SEC’s plans for climate-risk disclosures , this new assault on greenwashing moves US policy closer to its European counterparts, where fund disclosure rules are already reshaping the market.
This could stem from campaigns which lobby for divestment from polluting companies or projects. “In our view, the risk to investors from ESG or climate litigation remains primarily indirect,” Mark Banks, Dispute Resolution Senior Associate at Baker McKenzie told ESG Investor.
For ESG-aware investors, this paucity of solid information leads to questions over whether they should they wait for information flows to improve, pinning hope on further action from regulators or legislators, or divest their holdings to avoid uncertainty over the climate risks in their portfolios. They have to make that decision themselves.
Divest or wind down? This leaves it heavily exposed to reputational, regulatory and stranded-asset risk, leading many investors to avoid it. The company said it would continue the “responsible decline of its thermal coal operations over time”.
Reasons are manifold but include better risk management, earlier identification of strandedassets, and the realisation that Paris Agreement goals are in jeopardy. The results affect divestments in our portfolio.” Climate-intensive companies tend to be highlighted by this metric and yield the best and worst scores.
The report warns that fossil fuel demand will peak as government policies to cut emissions, asset owners’ net-zero commitments and the rapid growth of clean energy technologies combine to transition the economy towards renewables. Nothing could be more clear or present than the danger of fossil fuel expansion. C goal. .
Dr Tom Gosling, Executive Fellow at London Business School, has argued that some asset managers are effectively pulling their punches on net zero, holding off on implementing their collective and individual commitments, awaiting stronger policy direction from politicians. Lee suggests not. “In
In June, the Church of England Pensions Board (CoEPB) and Church Commissioners announced that they will divest from oil and gas firms for failing to align with climate goals. However, individual, specific, and isolated divestments do not make a significant difference due to the abundance of liquidity in the market. billion (US$13.2
The common use of ‘materiality’ and ‘scenario analysis’ reported by managers suggests these are already prevalent topics, while scarce mentions of ‘divestment effectiveness assessment’ or ‘enlightened active ownership’ “is consistent with the view that, in general, they are future behaviours,” the report said. A long way to go”.
For investors and companies with assets within those key biodiversity areas, this raises the issue of strandedassets. Large institutional investors have taken divergent approaches to managing the climate risks in their portfolios, with some pension funds divesting fossil fuel holdings.
University activists are increasingly citing the oil and gas industry’s targeting of kids in the classroom as another reason to divest from fossil fuels. The divestment solution. Divestment is an increasingly popular approach to combating the fossil fuel industry’s influence. The case for divestment is persuasive.
Additionally, divestment campaigns and the fear of strandedassets have become each new year more pressing. While both have been the bedrocks of modern civilization, their status had been increasingly under threat as cheaper and better alternatives reached markets.
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