Six insights on investing for net zero - SEI brief October 2021

Six insights on investing for net zero SEI brief Divesting from emissions-intensive sectors and companies seems to be the easiest October 2021 solution to bring investments in line with the Paris Agreement’s goal to bring global greenhouse gas emissions to net zero by mid-century. [...] What • policies and other system conditions necessary for companies to succeed with their does it take to achieve net zero? decarbonization strategies, and Opportunities and barriers in the steel, • when it appears that sectors and companies can adopt credible transition strategies cement, agriculture, and oil and gas that investors can support, and when other strategies, such as divestment, are l. [...] to get companies to commit to a long-term decarbonization agenda – to fundamentally sei2021.023 change their production systems and business models, and demonstrate that they are implementing these changes. [...] Investors need to better The extent to which companies will be able to to transition will often depend on understand their policy changes, new infrastructure development, and changes to both upstream and leverage points downstream value chains – all happening in parallel with their own efforts. [...] What investors can do is commit to not financing debt for new oil and gas exploration and development, to engage with banks to do the same, and to reduce financing for oil and gas in line with the declines in production needed to meet global climate targets.