The independent research finds that the valuation of high-carbon assets could be significantly impaired over time because of the indirect effects of the divestment movement. It says that investors would be running a significant risk if they ignore both the potential impact of this growing movement and the increasing concern around stranded assets and the 'carbon bubble' .
David Nussbaum, Chief Executive at WWF-UK, said: On the back of the IPCC giving us the clearest signal yet of the threats posed by a changing climate, and highlighting the need to act decisively to address the problem, it's clear that we must consider the risks to businesses and investors posed by investments in fossil fuels.
"Prudent investors want to be ahead of pack, not following the herd, so they will be preparing for a world where we leave fossil fuels in the ground - avoiding assets that cannot be realised safely in a carbon-constrained world. If they do nothing, the risk is that policy changes and pressures such as the divestment campaign will mean investments could depreciate in value and might become stranded.
"It's not as if we don't have solutions. We need to switch from investing in damaging fossil fuels and increase intelligent investment in sustainable renewable energy. Renewable energy isn't just the best choice, it's ultimately our only option, because the way the world produces and uses energy today is not sustainable, and has to change."
WWF is calling on investors and financiers around the world to end their support for coal and to increase investments in sustainable, renewable energy, including energy access for the poor .
Notes to editors:
2. Research from Carbon Tracker and the Grantham Research Institute on Climate Change and the Environment at LSE shows that that fossil fuel reserves already far exceed the carbon budget to avoid global warming of 2°C, but in spite of this, spent $674billion last year to find and develop new potentially stranded assets: http://www.carbontracker.org/wastedcapital
3. WWF's new global campaign, Seize Your Power, calls on financial institutions to significantly increase their funding of renewable energy and cut funding to fossil fuels because we recognise that the level of CO2 emissions in the world requires drastic action to limit global warming http://wwf.panda.org/about_our_earth/aboutcc/seize_your_power/
For more information:
Cara Clancy | Media Officer, WWF-UK
T: 01483 412 305 | E: firstname.lastname@example.org | M: 07917086494