Decarbonise or die, investors warn heavy industry


Steel and cement industries “must transform themselves if they are to survive the low carbon transition”, warn investors managing assets worth £14tn.

The world’s largest listed industrials have yet to take take firm action to ensure they meet Paris climate accords, UK environmental investors have found.

The Transition Pathway Initiative found that across four high-emitting sectors, only 19 per cent of global firms surveyed have set out process improvements needed to bring their operations into line with the Paris agreements. These oblige signatories to cut carbon in quantities necessary to keep temperature rises below 2 degrees before 2100.

The TPI is a consortium of institutional investors and asset managers – insurance and pensions providers – committed to pushing firms towards sustainable operation. The group’s 50 members, largely based in London, manage or advise on assets valued at $18 trillion (£14tn).

In 2018 the group questioned 72 publicly traded companies in steel, aluminium, cement and paper-making on their plans to cut carbon. Taken together with chemical manufacturers, these sectors account for two-thirds of carbon emitted by industry across the globe. A year later, the TPI repeated the survey to check on progress.

Researchers found that, besides only 19 per cent of the sample publishing a Paris-compliant internal action plan before 2020, no aluminium and steel producer had advanced at all in their carbon-cutting plans.

The investors were encouraged that 29 per cent of firms had identified actions needed to make them Paris-compliant by 2030, up from 23 per cent in the last survey. But it said plans must now translate into demonstrable actions.

The TPI also assessed firms on wider climate management issues, such as waste reduction and water consumption. Steelmakers showed the biggest improvements, advancing 30 per cent on a qualitative scale. But the TPI found that only 25 per cent of the sector’s producers were aligned with the Paris goals.

TPI co-chair Faith Ward, the head of responsible investment at Brunel Pension Partnership, commented: “Sectors like steel and cement face tough challenges to decouple emissions from production. These industries must transform themselves if they are to survive the low carbon transition”.

Details here.

Related stories:

Decarbonise or risk divestment, cement makers told

Blackrock: Firms that don’t decarbonise won’t get money

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