Dr Quintin Rayer and Dr Pete Walton: Bulk offsetting is better than nothing, but…

Reducing net emissions is essential

clock • 6 min read

Investors are increasingly aware of climate-related risks associated with extracting carbon from underground reserves, and can see that fossil fuel companies are responsible for a major source of emissions, write Dr Quintin Rayer and Dr Pete Walton. Thus far, though, responses have primarily been limited to shareholder engagement or divestment...

The fossil fuel companies are aware of the financial impacts society's actions have on them, with pressures to halt carbon-based fuel extraction, and associated investment risks intensifying. Future policy and technology changes could cause extraction firms to lose an estimated $34 trillion of revenue. Combined with changing investment policies, they may be unable to realise the value of fossil reserves, making current market valuations misjudged. Some argue that fossil fuel assets are increasingly uncompetitive, and their market share dropped from 29% of the S&P in 1980 to 5.3% by 2019....

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Investment

Navigating the intergenerational wealth shift with tokenisation

Navigating the intergenerational wealth shift with tokenisation

'Already gaining significant traction in fund management'

Stephen Ashurst
clock 21 May 2024 • 3 min read
Future of Investment Festival: Ten key reasons for advisers to attend

Future of Investment Festival: Ten key reasons for advisers to attend

Last call to financial advisers to join us on 5 June

Professional Adviser
clock 21 May 2024 • 2 min read
David Coombs: How to stop the exodus to Uncle Sam

David Coombs: How to stop the exodus to Uncle Sam

What's needed to stem the flow of UK companies rushing to list abroad?

David Coombs
clock 16 May 2024 • 3 min read