Danish pension Fund sells oil contracts due to climate change concerns
A Danish pension fund has said it will sell its stake in major oil companies because their business models are incompatible with the goals set out in the Paris Climate Agreement.
MP Pension, a $20 billion (18 billion euro) pension for Danish masters, masters, and doctoral students working at public universities and high school seniors, said it would tie up its stakes in 10 of the world's largest oil companies, including ExxonMobil, BP, Chevron, PetroChina, Rosneft, and Royal Dutch Shell.
The buybacks amount to almost $100 million, or 0.5% of the fund's total portfolio.
"We discovered that none of the major oil companies have a business model that meets the goals of the Paris Agreement, and so we decided to sell them all," chief investment officer Anders Shelde told DW. "We've put them all on our blacklist, our exclusion list."
The Foundation reviewed the companies' corporate strategies to find out how serious they are about addressing climate change, their capital investments to see if they are building new fossil fuel projects, and finally their lobbying efforts to make sure they are trying to match the climate.
Dirty Attachments
MP Pension's decision comes as asset managers around the world analyze their investments in oil, gas and coal companies at a time when the world is trying to limit the rise in global average temperatures to below 2 degrees Celsius compared to pre-industrial times, as agreed in Paris in 2015.
In March, Norway's $1 trillion asset manager, the world's largest sovereign wealth fund, said it would lose its stakes in oil and gas exploration and production companies. But the fund failed to meet expectations that it would dump all of its oil and gas investments forever. He said he would remain invested in major oil companies such as Shell, BP, Total and ExxonMobil, in which he owns significant stakes.
The Norwegian government stressed that the move was based solely on financial considerations, not climate concerns, and that it did not reflect any specific perspective on the future prospects of the oil industry.
MP Pension's latest statement is part of the decision made by the fund in 2016 that its investment strategy should be consistent with the objectives of the Paris Agreement.
But the foundation's latest move is based not only on climate issues.
"Our first and foremost concern is the future return on investment," said Shelde. "The companies we sell have been making poor profits for the last 4-5 years, and we believe they will remain poor for the next 10-20 years."
Stick to fossil fuels
MP Pension does not plan to completely withdraw from investments in fossil fuel companies.
"We are not completely abandoning fossil fuels. For example, we do not exclude companies that focus on gas, because we believe that gas is an intermediate fuel that we will need to replace, for example, coal, which has about twice the carbon intensity of gas," said Shelde.
"We understand that fossil fuels will remain part of the energy mix for many years, even 100 years. But we need to reduce the amount of carbon that we emit into the atmosphere."
The company has also prepared an "inclusion" list that would include fossil fuel companies that have made significant progress towards a greener future.
"So far, there are no companies on this list. It's still empty. But I hope it will grow as we move forward," Shelde said. флагман скачать
MP Pension, a $20 billion (18 billion euro) pension for Danish masters, masters, and doctoral students working at public universities and high school seniors, said it would tie up its stakes in 10 of the world's largest oil companies, including ExxonMobil, BP, Chevron, PetroChina, Rosneft, and Royal Dutch Shell.
The buybacks amount to almost $100 million, or 0.5% of the fund's total portfolio.
"We discovered that none of the major oil companies have a business model that meets the goals of the Paris Agreement, and so we decided to sell them all," chief investment officer Anders Shelde told DW. "We've put them all on our blacklist, our exclusion list."
The Foundation reviewed the companies' corporate strategies to find out how serious they are about addressing climate change, their capital investments to see if they are building new fossil fuel projects, and finally their lobbying efforts to make sure they are trying to match the climate.
Dirty Attachments
MP Pension's decision comes as asset managers around the world analyze their investments in oil, gas and coal companies at a time when the world is trying to limit the rise in global average temperatures to below 2 degrees Celsius compared to pre-industrial times, as agreed in Paris in 2015.
In March, Norway's $1 trillion asset manager, the world's largest sovereign wealth fund, said it would lose its stakes in oil and gas exploration and production companies. But the fund failed to meet expectations that it would dump all of its oil and gas investments forever. He said he would remain invested in major oil companies such as Shell, BP, Total and ExxonMobil, in which he owns significant stakes.
The Norwegian government stressed that the move was based solely on financial considerations, not climate concerns, and that it did not reflect any specific perspective on the future prospects of the oil industry.
MP Pension's latest statement is part of the decision made by the fund in 2016 that its investment strategy should be consistent with the objectives of the Paris Agreement.
But the foundation's latest move is based not only on climate issues.
"Our first and foremost concern is the future return on investment," said Shelde. "The companies we sell have been making poor profits for the last 4-5 years, and we believe they will remain poor for the next 10-20 years."
Stick to fossil fuels
MP Pension does not plan to completely withdraw from investments in fossil fuel companies.
"We are not completely abandoning fossil fuels. For example, we do not exclude companies that focus on gas, because we believe that gas is an intermediate fuel that we will need to replace, for example, coal, which has about twice the carbon intensity of gas," said Shelde.
"We understand that fossil fuels will remain part of the energy mix for many years, even 100 years. But we need to reduce the amount of carbon that we emit into the atmosphere."
The company has also prepared an "inclusion" list that would include fossil fuel companies that have made significant progress towards a greener future.
"So far, there are no companies on this list. It's still empty. But I hope it will grow as we move forward," Shelde said. флагман скачать