To Fight Climate Change, We Need to Understand Its Biggest Driver: The Coal Industry
Urgewald’s Global Coal Exit List (GCEL) is a powerful information tool and has played an influential role in shaping new policies by financial institutions on coal. Before the GCEL was published no one was providing good answers to the question: “Who belongs to the global coal industry”? As a matter of fact, before the GCEL was first published in 2017, hardly anyone realized that this question needed to be asked.
The availability or lack of information has a huge impact on the finance industry’s willingness to act. Even if the CEO of a financial institution is, in principle, willing to take action on coal, the first questions that come up are: How many companies in our portfolio would this affect? Which are these companies and how large are the positions we hold in them? What would be the overall impact of this decision on our portfolio?
But as a prominent French finance campaigner, says, “The Global Coal Exit List changed everything. It allowed us to move from general protests to putting forward fact-based and do-able demands for moving financial institutions’ portfolios away from coal”. With the help of the database, financial institutions could estimate how a policy commitment on coal would impact their portfolios and this often encouraged them to either take first policy steps or to upgrade existing policies. As of summer 2019, institutions with close to US$ 10 trillion assets under management are using at least one of the three GCEL criteria to screen coal companies out of their portfolios.
The second update of the GCEL was published in September 2019, and we hope it will encourage further financial actors to adopt or improve policies for a phase out of coal-related finance, investment and underwriting.