The carbon intensity of asset managers and ESG indices
klementoninvesting.substack.com
When it comes to dealing with fossil fuel companies, investors and asset managers can take four different approaches. They can decide to ignore the issue altogether as is typically done in ETFs and index trackers as well as in many conventional equity funds. Alternatively, they can decide to divest from companies that hold fossil fuels or decide to engage with company management to change corporate policy (an approach that we particularly like since it drives change). Finally, in recent years, more and more dedicated climate friendly and “green” funds have been launched that explicitly combine the previous two investment approaches with a preference for investments in renewable energy and other technologies that mitigate CO2 emissions.
The carbon intensity of asset managers and ESG indices
The carbon intensity of asset managers and…
The carbon intensity of asset managers and ESG indices
When it comes to dealing with fossil fuel companies, investors and asset managers can take four different approaches. They can decide to ignore the issue altogether as is typically done in ETFs and index trackers as well as in many conventional equity funds. Alternatively, they can decide to divest from companies that hold fossil fuels or decide to engage with company management to change corporate policy (an approach that we particularly like since it drives change). Finally, in recent years, more and more dedicated climate friendly and “green” funds have been launched that explicitly combine the previous two investment approaches with a preference for investments in renewable energy and other technologies that mitigate CO2 emissions.