Daily ESG Briefing: Net-Zero Asset Owner Alliance warns investee companies over coal

The latest developments in sustainable finance

The UN-convened Net-Zero Asset Owner Alliance, representing $5trn, is calling for the cancellation of all new thermal coal projects, a phase-out of all unabated existing coal-fired electricity generation, and an end to the financing, development and planning of further thermal coal power plants. In Thermal Coal Position, the Alliance says all companies in their portfolios should have a firm understanding of the wider implications of the activities, operations, and projects that they are engaged in.

ACTIAM, Aviva Investors, Fidelity International, and Robeco are amongst a coalition of nine financial institutions, representing €1.8trn assets under management, asking companies to take action to end deforestation in their supply chains, as well as to enhance supply chain traceability. Through this initiative, the coalition will reach out to companies that provide insufficient information about their supplier lists, as well as those linked to deforestation cases in the palm oil sector in Malaysia. If successful, investors will have access to more transparency in the supply chains of companies they invest in and be able to reduce deforestation risks in their portfolios.

The University of Dundee has committed to divest from fossil fuel companies in its £25m endowment portfolio within the next five years, following concerns raised by staff and students. Currently, the University holds approximately £1.7m in fossil fuels through its wider investment portfolio.

The Central Bank of Ireland is in the process of establishing a centralised Climate Change unit. Its development “further reflects the importance the Bank is placing on its role in relation to climate risk and the financing of a sustainable economy more generally”, said Gerry Cross, Director of Financial Regulation: Policy & Risk at the bank, at Sustainable Finance Ireland's third annual ESG Day.

The Australian Government has accepted a human rights complaint against Rio Tinto, filed by Australia’s Human Rights Law Centre (HRLC) on behalf of 156 residents of Bougainville in Papua New Guinea. The complaint relates to operations by Rio Tinto’s subsidiary Bougainville Copper, which abandoned the area in the 1990s due to civil war. The community claims the company is responsible for the waste left by the copper and gold mine, which is poisoning their water sources, flooding their lands and sacred sites, and causing a range of health problems. In response, Rio Tinto said that despite not having had staff at the mine since 1990, it was aware of the “deterioration of mining infrastructure at the site and surrounding areas, and claims of resulting adverse environmental and social, including human rights, impacts.”