A decade ago, it was very conventional for asset managers to have exposure to the oil and gas sector as part of a diversified portfolio. Calls for them to divest from carbon assets because climate policy could render fossil fuel reserves unburnable mostly fell on deaf ears. But now the oil & gas sector has turned in a decade of underperformance, vaporizing tens of billions of dollars and becoming the worst-performing sector in the world. Now banks, asset managers, and even oil operators have now joined the ranks of those worrying aloud about the increasing risk of stranded assets. Now, the warnings about stranded assets are converging with calls for companies and investors to apply ESG filters to their activities, and investors are demanding divestment from carbon-heavy assets.
One think-tank saw all this coming: Carbon Tracker. In fact, they put the concept of stranded fossil fuel assets on the map over a decade ago. In this episode we speak with its founder, Mark Campanale, about what investors have learned from the experience of the past decade, what they still need to do going forward, and some of the more interesting efforts that are under way to encourage divestment from carbon and reorient capital toward energy transition solutions.
Mark Campanale is the Founder of the Carbon Tracker Initiative. He is also the co-founder of Planet Tracker. Prior to forming these groups, Mark had twenty five years’ experience in sustainable financial markets working for major institutional asset management companies. Mark is a co-founder of some of the first responsible investment funds, including Ecology Funds with Jupiter Asset Management, NPI with Global Care, the AMP Capital Sustainable Future Funds, and Henderson Global Investor’s Industries of the Future Funds. Mark served on the World Business Council for Sustainable Development working group on capital markets leading up to the 1992 Earth Summit; was a Member of the Steering Committee of UNEP Financial Sector Initiative (1999-2003). Mark is a Founder Director of the UK Sustainable and Responsible Investment Forum (UKSIF), 1990-2006, a member of the Advisory Board of the New Venture Philanthropy’s ‘Conservation and Markets Initiatives’; is Hon Treasurer of The Rainforest Foundation UK and on the Development Board of the Ashden Awards. Mark is an advisor to Consilium Capital, to Faith Invest and serves on the Advisory Board of Tribe Impact Capital.
On Twitter: @CampanaleMark
On the Web: Mark’s page at Carbon Tracker
Recording date: September 16, 2020
Air date: October 28, 2020
Geek rating: 7