Climate change the ‘most common’ reason for portfolio exclusion

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🗞️ Driving the news: Climate change concerns are the top reason financial groups exclude companies from their portfolios, as highlighted by a study conducted by a coalition of environmental and sustainability non-profit organizations

🔭 The context: The research unveiled that 40% of company exclusions were due to climate change worries, 17% were attributed to concerns over involvement in weapons manufacturing, and 12% were related to tobacco
• This focus on ESG (environmental, social, and governance) factors persists despite a growing critique against “woke” capitalism, particularly from some US Republican politicians and state treasurers

🌍 Why it matters for the planet: The shift away from industries detrimental to the environment, particularly fossil fuels, underscores the increasing recognition of the financial risks tied to climate change
• Notable financial behemoths like Norway's $1.4tn oil fund have taken steps to exclude companies with high greenhouse emissions, signaling a broader, global trend towards sustainable investment

⏭️ What's next: The research, which inspected the exclusion practices of around 150 financial entities, published a list of 4,532 companies excluded by 87 institutions across 16 countries
• The organizers hope that making this list public will compel the listed companies to amend their practices

💬 One quote: “The tracker shows that fossil fuels are becoming a 'sin' industry... [it] should spur oil and gas companies to speed up their energy transition efforts," (Ward Warmerdam, Profundo)

📈 One stat: Poongsan Corporation from South Korea tops the list as the most excluded company, cited by 75 financial entities due to its production of controversial weapons

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