Ostrum calls for greater transparency from oil and gas industries
Ostrum Asset Management has long been committed to combating the causes of global warming and CO2 emissions, and over the past two years, the company has managed to offset 100% of its direct carbon emissions.
Ostrum Asset Management has also been very involved in lobbying against oil and gas drilling in the Arctic, so in a logical next step, it has been calling for greater transparency and a clearer position from the oil and gas industry on this issue. CDP1 estimates that the oil and gas industry and its products2 account for 50% of global carbon emissions, so these companies lie at the very heart of this issue.
Ostrum Asset Management has therefore signed a proposal set out by NGOs asking investors who attended Royal Dutch Shell’s meeting on May 22 to vote on whether the company should set firm carbon emissions targets in line with the Paris Agreement. Shell’s goals in this area and its decision on this matter could then act as an example to other companies.
The resolution voted during the Shell shareholders’ meeting is encouraging in this respect, as it states “the transition towards a net-zero emissions energy system and a world where temperature increases are limited to less than 2C will unfold over several decades and will require concerted action by many, including Shell.... Shell is committed to playing its part … to take sensible steps to help tackle climate change and ensure we thrive through the energy transition”.
Beyond this concrete outcome, the proposal signed by Ostrum should strongly encourage all companies in this sector to clarify how they see the future in a low carbon world. Clear commitments will need to be taken to substantially cut back carbon emissions, but also to assess the impact of emissions from the use of their products2 and explain how the investments they make today in energy sources and technologies are compatible and consistent with a pathway towards the Paris goal.
Investor signatories, including Ostrum AM, also urge policy-makers to take more collective action on implementing regulation which will create the signals required to support the necessary investment in lower carbon technologies.
1 Formerly known as the Carbon Disclosure Project.
2 For companies in the sector, emissions from the use of their products (scope 3 emissions) account for around 90% of all their emissions.