Oil companies will cease to be attractive investments

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  • 29 Apr 2019 12:00 AM
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Fund Managers Worth $10.2 Trillion Urge Oil Firms to Align With Paris Agreement Goals

Oil companies will cease to be attractive investments unless they quickly adopt low carbon business models that support the Paris Agreement’s climate targets, new findings suggest. This was the result of a survey of 39 fund managers responsible for $10.2 trillion of assets worldwide, carried out by the UK Sustainable Investment and finance Association (UKSIF) and charity the Climate Change Coalition. In total, 86 percent of respondents called on oil firms to align their businesses with the Paris Agreement’s goals, with nearly half calling to policies consistent with a 1.5⁰C global warming pathway, while the remaining 43 percent called for a 2⁰C target. A number of leading oil majors have recently unveiled plans to step up clean energy investment and develop strategies that are compatible with the Paris Agreement. However, critics have argued the promised strategies look like they will be narrowly focused on emissions from their direct operations and will largely ignore emissions from the fuels oil majors provide, meaning they will still be exposed to ‘stranded asset’ risks as economies decarbonise.

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