Investors representing $2tn in assets have called on cement makers to commit to net zero by 2050 – or risk funds divesting and access to capital drying up.
In a letter to cement makers CRH, Lafarge and Heidelberg Cement, and construction materials maker, Saint-Gobain, members of the Institutional Investors Group on Climate Change (IIGCC) and participants in Climate Action 100+ urged immediate action and increased R&D spending to enable decarbonisation of the industry.
“The cement sector needs to dramatically reduce the contribution it makes to climate change. Delaying or avoiding this challenge is not an option. This is ultimately a business-critical issue for the sector,” said Stephanie Pfeifer, CEO, Institutional Investors Group on Climate Change and a member of the Climate Action 100+ global steering committee.
“Major economies such as the UK and France are increasingly adopting economy-wide net zero emission targets. The cement sector needs to get ahead of the profound transformation their sector faces by addressing barriers to decarbonisation in the short- to medium-term if companies are to secure their future.”
The group said cement makers account for 7 per cent of man-made carbon dioxide emissions. It noted Heidelberg Cement has set a decarbonisation target, and advised others to follow suit.
“Construction materials companies may ultimately risk divestment and lack of access to capital as an increasing number of investors seek to exclude highly carbon-intensive sectors from their portfolios to meet their own decarbonisation plans,” said Vincent Kaufmann, CEO Ethos Foundation. “Investors expect construction materials companies to substantially increase the R&D budgets available for research into decarbonising cement production.”
The letter was signed by RPMI Railpen, Hermes EOS3, BNP Paribas Asset Management, Aberdeen Standard Investments, the Local Authority Pension Fund Forum, Ethos Foundation, Trusteam Finance, Sarasin & Partners, Degroof Petercam Asset Management and Nykredit Asset Management. They collectively have or represent over $2 trillion in assets, assets under management and under advice
Details here.
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