Fossil Free Indexes (FFI), a provider of financial research and products for investors seeking to understand, measure, and act on climate risks, has today launched their third annual report, The Carbon Underground 2016: Managing the Climate Risks of Fossil Fuel Companies. The report analyses the past year's changes to The Carbon Underground 200TM (CU200), FFI's list of the top publicly-traded coal, oil, and gas reserve owners ranked by the potential carbon emissions of their reported reserves. FFI collaborator and leading advisor on sustainability-related portfolio risks, South Pole Group, has provided a discussion of carbon footprinting for the report, including a carbon footprint of the CU200 based on estimated emissions from operations.
The report highlights that investor activity motivated by the financial risks of climate change has surged, accelerated by the success of the 21st UN Climate Change Conference of the Parties (COP 21) and other high-profile climate actions. The report details recent actions in the areas of divestment and shareholder engagement, and provides an overview of several other strategies that climate-focused investors can utilize to manage risk and generate returns. FFI CEO and report co-author Christopher Ito observes: “As more investors assess the impacts of a transition to a low-carbon economy, divestment, engagement, risk management, and active portfolio management will all be viewed as appropriate and even complementary responses to climate risk."
South Pole Group's Partner for the Financial Industry and report co-author Maximillian Horster adds: “We are pleased to complement The Carbon Underground annual report with an in-depth emission analysis of the assessed companies and a carbon footprint measurement. It is important to offer the investment community as many tools as possible to fully embrace and combat the intricate risks posed by climate change -- understanding one's carbon footprint is a first step for every climate impact assessment."
Specific report findings on the fossil fuel industry show:
The top 10 coal and top 10 oil and gas companies in the CU200 are listed in the report. The entire 2016 CU200 list is available for non-commercial purposes to asset owners, not-for-profit organizations, and members of the media at no cost, and is available quarterly by paid subscription for asset managers and consultants. Eligible users can download the list on the company website.