As Legal & General\u2019s AGM opens tomorrow and with COP26 in Glasgow only six months away, it\u2019s time to take a closer look at L&G\u2019s climate plans, or lack thereof. L&G is the top UK coal investor and is not heeding calls to stop investing in new oil, coal and gas production. Current efforts to engage with high-emitting companies and loud commitments will not be enough. L&G needs to adopt strong exclusion policies in order to meet its net zero commitment by 2050. Legal and General Group is a heavyweight in the City of London and among the biggest European asset managers (\u00a31.3 tln of assets under management). The group is quite vocal on climate topics and has committed to achieving net zero carbon emissions by 2050 (1). It regularly and proudly puts forward its voting record to prove its leadership on climate issues. Unfortunately, a positive voting track record<\/a> will not be enough to phase out fossil fuels from its portfolio (2).<\/strong><\/p>\n Yesterday, the International Energy Agency issued its strongest warning yet on the need to phase out fossil fuels<\/a>; achieving net zero by 2050 means keeping oil, gas and coal in the ground from 2021 onwards. Yet the L&G Group still hasn\u2019t adopted global restrictions on fossil fuel developers<\/strong> and is propping up the fossil fuel industry with continuous investments in coal, oil and gas expansion.<\/p>\n<\/div> According to our recent Reclaim Finance & Urgewald report, Legal & General still holds $7.2 billion in the coal industry<\/strong>, which is more than 20% of all UK investments in the sector as of January 2021.<\/p>\n L&G\u2019s current global coal exclusion policy is too weak to change that<\/strong>:<\/p>\n The exclusion thresholds are too high to divest from diversified coal mining companies and utilities, even if they are coal giants. The policy also makes room for new coal, given that it does not exclude coal developers. This means L&G can sustain investments in a diversified group like BHP Group, one of the top 100 greenhouse gas emitting companies of all time, producing 27 millions tons of coal a year, and with coal expansion plans.<\/p>\n Worst of all, the coal exclusion policy does not apply to the $1 trillion that is managed \u2018passively\u2019<\/strong> and can still happily be invested in any coal company<\/a>, no matter how much they fuel climate change. Legal and General will need to tackle its \u2018passive\u2019 problem<\/strong> if it truly wants to \u201caccelerate the sustainability revolution\u201d.<\/p>\n<\/div>
\n<\/b><\/p>\n<\/div><\/div><\/div>L&G is not the climate hero it would like to be<\/b><\/h1><\/span>
Still heavily addicted to coal<\/b><\/h2><\/span>
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