By Profile Profile
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April 20, 2021
In June 2019, a group of 88 investors with nearly $10 trillion in assets publicly called for more transparency on environmental impact data from 707 companies based in 46 countries. With a joint market value of more than $15 trillion the group includes from large fossil fuel companies such as BP, Chevron to online retail giants Alibaba and Amazon. The appeal requires standardized dissemination on global carbon emissions dissemination network platform. It's not an isolated movement. today more than 1,700 asset managers totaling $80 trillion have already incorporated environmental impact data into their investment analysis. Among them is the world's largest asset manager, The American Black Rock. The pressure for transparency come from the financial market, consumers and even employees. In the case of Amazon, in an unprecedented effort, more than 6,000 employees signed an open letter to world founder and President Jeff Bezos in April 2019. In it, they call for the release of a robust and immeasurable emissions reduction climate plan for the company whose market value is around $1 trillion. This is a movement that not only impose challenges for companies. New business opportunities in products of around $2.1 trillion are estimated. The world's largest listed stock companies anticipate climate risks of about a trillion dollars, much of it over the next five years. On the one hand there are risks associated with physical impacts: storms, floods, droughts, and forest fires, which affect production, distribution, and sales costs. On the other, there are regulatory risks associated with the transition to a low-carbon economy. Of this amount of $1 trillion reported, about $500 billion is classified as virtually certain, and linked to legal and policy changes. For the oil and gas sector, there is a risk of estimated losses of $250 billion per devaluation associated with unrecoverable assets, which are fossil fuel reserves that must remain untouched to meet the goals of the Paris Agreement. The financial services industry is also on the front line. There is an increasing pressure for more transparency on investments that will force institutions to focus more on green energy and innovation and less on polluting sources.