Is this a COVID-19 effect? Economic recovery with oil and gas demonised might be even more difficult than necessary, but cries of ‘energy sources incompatible with Paris goals’ can be heard from climate fearmongers.
Investors, politicians and campaigners have hit out at EU regulators’ “ludicrous” exclusion of oil and gas from a definition of fossil fuels, arguing it will lead asset managers to understate their environmental risks, reports The Conservative Investor Daily.
Under draft proposals for the EU’s sustainable disclosure regime, the European authorities responsible for banking, insurance and securities markets define fossil fuels as only applying to “solid” energy sources such as coal and lignite.
This means asset managers and other financial groups would have to follow tougher disclosure requirements for holdings in coal producers than for oil and gas company exposure.
The huge rise in popularity of ESG investing over the past decade has prompted regulators to take measures to confront the risk of greenwashing.
The latest EU proposals represent a significant watering down of its ambitious sustainable disclosure rules, which aim to give end investors clear information on the environmental, social and governance risks of their funds.
But critics also argue they risk undermining the EU’s commitment to becoming a world leader in sustainable finance, a key priority for the bloc as it seeks to tie the coronavirus recovery to creating a greener economy.
The exclusion of oil and gas ‘could, at best, result in an underestimation of the true investment risk, and at worst, contribute to further support for energy sources incompatible with Paris goals’.
Sébastien Thevoux-Chabuel, ESG analyst at $37bn fund group Comgest, said making a distinction between liquid and solid fossil fuels was “quite ludicrous” and would “not reflect well” on the fund industry.
Paul Tang, one of the MEPs responsible for drafting the original law, said the proposals went against the rules’ aim to provide easy-to-understand information to investors.
He added: “Excluding oil from the definition of fossil fuels is everything but straightforward. It is set to confuse the market and open the door to greenwashing.”
Full report here.
via Tallbloke’s Talkshop
May 3, 2020 at 11:06AM
Iowa Climate Science Education 