Divestment and engagement: moving companies towards the future
Can investors make a difference at all?
A growing number of actors are demanding that companies making profits as a result of climate-damaging activities adopt new strategies, business models and measures to fight climate change. As many as 1,000 institutional investors have already decided to withdraw their capital from companies strongly engaged in coal, oil and gas. In addition to putting pressure on companies through the threat of capital withdrawal, investors can also exert a direct influence on these companies. This approach is built on the assumption that companies can gradually reduce or end their climate-damaging activities as part of their company strategy. Fossil fuel companies are confronted in the form of appeals, letters, enquiries, dialogues, and at shareholder meetings, demanding that they present goals, strategies and measures which will bring their business activities in line with the Paris Climate goals.
The enquiries made by customers of banks, insurance companies and investment funds increase the pressure on these companies. Each of us can help to force a company to reconsider or reorient its direction.