Following their analysis, they found that companies that could play a decisive role in helping to decarbonize the future are US-based investment advisers Blackrock, Vanguard Group, State Street Corp., Dimensional Fund Advisors, Fidelity Investments , Capital Group Company, together with the Indian State Government and Life Insurance Corporation, as well as the Kingdom of Saudi Arabia and Norges Bank of Norway.
Other players in the top 20 include the Americans JPMorgan Chase & Co., Citigroup Inc., HDFC Asset Management, Geode Capital Management and the Bank of New York Mellon, the Indians Adani, Gautam S., the Russian Federation and the Chinese Shaanxi Coal & Chemical.
“This shows us that investors and governments can be at the forefront of change if citizens and customers urge them to decarbonize,” University of Waterloo lead researcher Truzaar Dordi said in a statement. hurry. “A concentrated number of investors with the potential to influence the trajectory of the fossil fuel industry is either a problem or an opportunity, depending on how you look at it.”
By region, the study shows that 60 CU200 companies are registered in the United States, followed by China, Canada, Russia, Australia and India. These companies may trade on a different exchange than the country in which they are registered. By exchange, 61 companies are listed on the United States stock exchange, followed by China, Canada, Australia, Hong Kong and Russia. In contrast, the ownership distribution is skewed toward the United States, with 213 of the 918 separate direct and indirect shareholders holding more than 1% ownership in at least one of the US-based fossil fuel companies in the sample. .
“If serious, capital markets can enable a low-carbon transition among the world’s major owners of coal, oil and gas reserves,” Dordi said. “Recent promises to reduce carbon exposure in investment portfolios and engagement with the fossil fuel industry indicate that we may already be heading in that direction.”
The document outlines specific ways the top 10 governments and private investment advisers can make changes that will have a transformative impact in the fight against climate change. Some recommendations include public disclosure of a planned phase-out of fossil fuel financing, an assessment of a portfolio’s exposure to climate risk in a 2°C world, and alignment of investment portfolios with a 1 .5°C.
“Individually, reducing the demand for fossil fuels by driving and flying less and turning off the air conditioning is a good thing. We should continue to do so,” the researcher stressed. “But we also need to reduce our fossil fuel production, which these 10 players can lead. Without them, we simply won’t have what it takes to meet our emissions targets and avoid catastrophe.
In other words, the authors of the study believe that, through their influence on the functions of resource mobilization, capital markets have the potential to disrupt the regimes in place and create conditions conducive to transitions towards sustainability. .