Further focus on the green transition to meet the goals of the Paris Agreement.
Velliv supports the Paris Agreement and the need for a green and just transition to reach net-zero global emissions before 2050.
“There are many ways where we can intensify the fight against climate change, and at Velliv, we believe focus should be on firstly, a global halt to the exploration of new oil and gas fields. Secondly, to increase blended capital towards impact investments, and thirdly, a pursuit of better quality in ESG data to compare climate performance and make more informed decisions,” says CIO Anders Stensbøl Christiansen from Velliv.
No need for new oil and gas fields
The research is clear, fossil fuel production needs to be phased out. The world already has abundant access to oil, gas, and coal to last until we have completed the green transition.
“A global halt to the exploration and development of new oil and gas fields is needed. Velliv is calling on governments to stop approving new oil and gas fields and for financial institutions to restrict access to capital for new oil and gas fields,” says Anders Stensbøl Christiansen
Velliv will only invest in upstream oil, gas and utility companies with a credible transition plan in place in line with the Paris Agreement. Currently, no upstream oil and gas companies pass this criterion.
An increased focus on impact investments
Impact investments need to be significantly increased, where capital is steered towards investments with a clear intent of a positive environmental and social impact. We need more blended finance to funnel capital flows to the areas that need them the most; developing countries, where the risk of investing typically is higher, and therefore doesn’t always fit institutional investors’ risk profile. Here blended finance plays a crucial role.
Velliv expects to invest a significant amount in impact investments in the coming years. Today, Velliv has already invested in funds focused solely on impact investments and in Green and Sustainability Bonds with clear frameworks for driving positive environmental and social impacts. In collaboration with partners such as the World Bank Group, Velliv has helped to pioneer innovative structuring in impact bonds where the investment return is directly linked to a positive outcome in terms of emission reductions.
Pursuit of better data quality
A challenge the financial industry faces is the lack of high quality ESG data. It is imperative for investors to have transparency and comparability in ESG data to make informed decisions and document climate impact. Though companies in Europe are currently well on their way in developing and providing such ESG data, Velliv as a global investor sees a need for global standards for ESG data.
We need to funnel more capital towards investments with a positive impact across national borders, in particular in developing countries. Climate change knows no borders,” ends Anders Stensbøl Christiansen.
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