https://on.ft.com/2Sqcjbn
Passive index trackers help to keep money flowing to high-carbon industries
With such a strong financial case against fossil fuels coming into focus, and starting to convince holdouts, activists’ plans to starve oil, gas and coal companies of capital should get a boost as investors abandon the sector for non-ideological reasons. Yet even with this tailwind, the impact of their campaign will be limited as long as people continue ploughing money into market-tracking passive funds.
Christopher K. Merker, PhD, CFA, is a director with Private Asset Management at Robert W. Baird & Co. and executive-in-residence and co-director of the Marquette S-Lab. He is also founder and chair of the board of Water + Energy Forward, a green bank focused on market-based climate solutions. He holds a PhD in investment governance and fiduciary effectiveness from Marquette University, where he has taught “Sustainable Finance” since 2009. He publishes
Sustainable Finance and is co-author of
The Trustee Governance Guide: The Five Imperatives of 21st Century Investing.
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