– Climate change and the challenges concerning fossil fuel investments
Climate change is complex and can no longer be ignored. The longer we wait, the stronger the impact will be, having a dire effect on our investment portfolios as well as the global economy, with consequences that will only increase over time.
In order to meet the ambitious goal of the 2 degrees Celsius threshold by 2050, a carbon budget has been calculated and only about 20% of the total fossil fuel energy reserves should be exploited. In the event of more stringent regulations, companies holding said reserves will no longer be able to fully exploit them, although still prized by the markets.
The carbon emissions of our companies will therefore become risk factors in the same way as other traditional risk factors, needing strong consideration and analyses in order to be properly evaluated.
This is how we, as investors, try to make a difference – by thinking about how to mitigate this risk through the combination of economic, social and environmental dimensions.