Almost 40% of the respondents to a survey of RI readers on the highly topical subject of fossil fuel divestment believe that the growing campaign to push investors to boycott the sector is the start of a ‘paradigm change’ that will see media and governments start to put serious pressure on institutional investors to act. A slightly higher number (44.2%) said they believed the divestment movement was less dramatic, but catching “some” public attention and would impact investors, but without leading to any systemic change. In contrast, 11.6% of respondents said the campaign was “misguided” and should be challenged by investors, while a small number (4.7%) agreed with the statement that the largely student-led campaign would fizzle out. The divestment movement has already led several cities, states, universities, foundations and pension funds to divest their fossil fuel holdings in order to reduce their exposure to C02 emissions and combat climate change.
The respondents to the RI Insight survey, of which more than half were either asset owners or asset managers, almost universally agreed (97.9%) that investors were not doing enough to evaluate the risks of fossil fuel exposure and climate change into their buy/sell decisions for investee companies. A similarly high number (93.6%) said investors were also not doing enough on policy engagement with companies and governments to reduce the potential market risks associated with global warming.The RI Insight survey on fossil fuel divestment was carried out jointly with the Network for Sustainable Financial Markets and Preventable Surprises
The anonymous survey was sent out to RI readers for one week only to get a snapshot of investor sentiment on the issue. Responses were received from 48 individuals/organizations. RI has aimed for full transparency in the disclosure of results and responses. Of the respondents, asset owners represented 24.4%, asset managers 34.1%, consultants 12.2%, ESG/financial research companies 17.1%, and NGOs/think tanks 12.2%.
Significantly, more than a third of the survey respondents (38.6%) said they had already divested some assets because of global warming/investment risk concerns. More than two thirds (70.5%) said they were engaging with fossil fuel and other high impact companies on their environmental policies. This matched the importance that respondents attached to engagement, citing it as the most strategically important thing investors could do on climate change. Just under half (45.5%) said they were lobbying governments over their climate change regulations.
The survey also poses questions on carbon pricing, green bonds, the Asset Owner Disclosure Project, and includes respondent comments on the divestment campaign.
The full survey results can be read in the charts in the downloadable documents column: left hand of page
A full PDF report of the survey results and comments will be available soon on RI.
The RI Insight survey was designed by Raj Thamotheram, CEO of Preventable Surprises and Hugh Wheelan, Managing Editor of Responsible Investor
Survey charts: credit Kazutaka Kuroda (NSFM)
Read the three-part RI divestment article series by Raj Thamotheram
Part 1: the fossil fuel divestment debate: Is there a consensus way forward?
Part 2: What impact could divestment have on share price and the energy sector?
Part 3: fossil fuel divestment: Is there a “common ground” strategy?