Daily ESG Briefing: BlackRock cites “stranded assets” as reason for voting against Yanzhou deal

The latest developments in sustainable finance

Investment behemoth Blackrock voted last week against plans by the board Yanzhou Coal Mining Company to acquire equity interests and assets from its Chinese state-owned parent firm Yankuang Group Company, citing the risk of stranded assets. In its voting bulletin, the investors raised “concerns about the underlying valuation for the terms of the transaction and management’s oversight of potential stranded asset risks”.

Swedish pension fund Sjunde AP-fonden (AP7) has excluded 10 coal firms, including Korea Electric Power Corporation, Coal India and China Resources Power Holdings because their investments in coal production and power render them incompatible with the Paris Agreement. 

Ostrum Asset Management intends to exit coal by 2030 for OECD countries and by 2040 for non-OECD countries. This is the latest iteration of the Natixis affiliate’s coal exclusion policy, which it rolled out in 2018. It will set interim targets, beginning with a ban on investing in companies that develop new coal projects, starting in January. It will exit existing holdings within six months. 

Exxon has received a shareholder resolution from campaign group As You Sow, asking it to address the potential for its petrochemical investments to become stranded due to a slow down in demand for commodity plastics, the oversupply of plastic feedstocks and changes in public opinion on plastic. As You Sow filed a similar resolution at Dow earlier this year

Every member of France’s CAC40 index has come out in support of the Taskforce on Climate-related Financial Disclosures’ recommendations. The commitment was signed by Bruno Le Maire, France’s Minister of the Economy, Finance and Recovery, and Olivia Grégoire, the Secretary of State in charge of the Social, Solidarity and Responsible Economy. It was also backed by Augustin de Romanet, the President of Paris EUROPLACE, Thierry Déau, President of Finance for Tomorrow, Stéphane Boujnah the CEO of Euronext, and Robert Ophèle, President, Autorité des Marchés Financiers.

Norges Bank Investment Management has agreed to publish its voting intentions for Norway’s $1.2tn oil fund five days ahead of AGMs, according to the Financial Times. The investment titan will release its plans in advance of 12,000 meetings next year.  

Sustainability funds managed by WHEB, Liontrust and Ballie Gifford are among those reviewing their investments in insulation maker Kingspan, following links between its products and the Grenfell fire in London, which killed 72 people in 2017, say reports in Citywire Selector. The tower block is believed to have used materials from Kingspan, which is a popular energy efficiency stock for green funds. Kingspan’s response to the allegations can be viewed here