Investments

Dutch pension fund ABP to promote $17.5 bln of fossil gas belongings

A leaf sits on prime of a pile of coal in Youngstown, Ohio, U.S., September 30, 2020. REUTERS/Shannon Stapleton

AMSTERDAM, Oct 26 (Reuters) – Dutch pension fund ABP, one of many world’s largest, will divest 15 billion euros ($17.5 billion) of investments in fossil gas producers by 2023, it stated on Tuesday, citing concern over world warming.

The choice forward of subsequent week’s COP26 United Nations local weather convention marks a serious turnaround for the civil servants’ fund, which has 528 billion euros in belongings underneath administration.

As lately as June ABP had stated that exiting fossil gas investments was “not the answer” to world warming, regardless of stress from environmental activists and a rising variety of the fund’s personal contributors. learn extra

After the deliberate sale, which represents 3% of the fund’s complete belongings, ABP intends to extend funding in renewable vitality the place attainable, Chairman Corien Wortmann stated in an announcement.

Requested in regards to the turnaround, Wortmann informed nationwide broadcaster NOS it had been prompted by rising issues about local weather change and the newest UN local weather report.

“The earth is projected to warmth up by 1.5 levels already inside seven years. Which means a radical likelihood is required and that’s partly the rationale why we at the moment are asserting this opportunity in fact,” Wortmann stated.

The Dutch transfer got here as asset managers Constancy Worldwide and BlackRock additionally introduced a tighter give attention to emissions forward of the COP26 talks in Scotland. learn extra

Saying Tuesday’s determination, Wortmann cited issues of fund contributors and their employers.

“The ABP Board sees the necessity and urgency for a change in fact,” she stated. “We (are parting) with our investments in fossil gas producers as a result of we see inadequate alternative for us as a shareholder to push for the mandatory vital acceleration of the vitality transition at these firms.”

She stated that sooner or later the fund would give attention to engagement with massive shoppers of fossil gas comparable to electrical energy firms and the auto and aviation industries.

“Utilizing our affect as a shareholder, ABP will encourage firms that use fossil fuels to change into extra sustainable.”

The fund stated it didn’t anticipate the choice to have an effect on its long-term returns.

($1 = 0.8593 euros)

Reporting by Toby Sterling; Further reporting by Stephanie van den Berg; Enhancing by David Goodman, Stephen Coates and Jan Harvey

Our Requirements: The Thomson Reuters Belief Ideas.

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