Investors really do care about stranded assets, survey says
Major fossil fuel companies such as ExxonMobil and Shell may find it expedient to trivialize the importance to investors of stranded assets — assets that may become obsolete due to climate change regulations. But as a survey recently undertaken by First Affirmative Financial Network demonstrates, investment professionals are taking the issue very seriously.
First Affirmative conducted its survey (PDF) of nearly 600 sustainable investment professionals in advance of its annual SRI Conference on Sustainable, Responsible, Impact Investing, which it will host in November in Colorado Springs.
According to the survey results, 76 percent of respondents believe that there are growing risks associated with investing in companies in the fossil fuel industries. Seventy-two percent believe that now is the right time to rethink their approach to investing in fossil fuel companies.
Half of respondents believe that institutional investors are interested in reducing their exposure to fossil fuel companies, while two-thirds state that retail investors are interested in doing so. Furthermore, for those institutions and individuals interested in fossil fuel free investing, the choices are increasing. The percentage of professionals offering fossil fuel-free investment alternatives increased to 36 percent this year, a 50 percent improvement over 2013.
"If there is a hot topic around SRI office water coolers, this is it," First Affirmative President Steve Schueth said. "The 2014 Fossil Fuels Divestment Survey results confirm that interest in fossil fuel-free investment strategies is on the rise.
"The growing drumbeat of responsible investors seeking investment strategies with little or no exposure to coal, oil and gas extraction companies will only increase as more evidence of the negative effects of climate disruption reverberate from the recent IPCC and National Climate Assessment reports, and as more analysts and investors understand the stranded asset risk equation."