Home > Adani Ports kicked off MSCI indices due to Carmichael coal link

Adani Ports kicked off MSCI indices due to Carmichael coal link

26 November 2021

26 November 2021

Finance research and ratings company MSCI wrote to its clients on Tuesday informing them that Adani Ports and Special Economic Zone (Adani Ports, also referred to as APSEZ) is about to be kicked off four MSCI climate indices, after its links to the Carmichael thermal coal project in Australia escalated its assigned controversy score to “severe”. 

MSCI is used by investors all over the world. It creates a whole range of ESG (environment, social, governance) focused indices which allow investors to put their money into sets of companies that meet certain criteria. MSCI uses a complex methodology to rate the ESG performance of companies, which includes an overall ESG rating and a controversy score. Adani Ports already has the lowest possible ESG rating of “CCC”, and its controversy score is now “severe”, the second-worst possible.

This “severe” controversy score means it will be removed from four Climate Change branded indices on 1 December 2021. Funds managed by major investors that rely upon these indices have now been divested from Adani Ports!

MSCI’s told clients the four indices are:


In a separate email, MSCI informed Market Forces that Adani Ports’ setting up of Bowen Rail Company, the haulage company for the Carmichael coal mine, is the reason why the Carmichael coal project has been added as a controversy with which Adani Ports is associated.

Adani Ports set up the Bowen Rail Company in 2019 and announced in January 2021 that it would transfer ownership across to Adani Enterprises (completed in July 2021). Adani Ports admitted in its annual report (see page 129) that this transfer was in order to “fulfil the Carbon Neutral Commitments” of the company (despite intending to increase the amount of coal it transports and its plans to build new coal and LNG terminals, Adani Ports claims it will be carbon neutral by 2025). 

Therefore, by Adani Ports’ own admission, it attempted to avoid being held accountable for its role in the climate-wrecking Carmichael project by using the Adani Group’s complex corporate structure to shift a dirty businesses onto one subsidiary in order to claim carbon neutrality in another. Meanwhile the Carmichael coal mine and rail line continues to be built. Thankfully MSCI has finally seen through this farce, and more ratings agencies, banks and investors need to follow its lead. 

(This is not the first time Adani Ports has been removed from an ESG index, with S&P removing it from the Dow Jones Sustainability Index in April 2021, due to its business links with the Myanmar Military. State Street Global Advisors also have Adani Ports and Adani Enterprises on its exclusion list for some ESG indices it uses.)

In any case, even after shifting ownership of Bowen Rail Company, Adani Ports still has a direct link to the Carmichael project via its operation of the North Queensland Export Terminal (NQXT, formerly Adani Abbot Point Terminal) in the Great Barrier Reef World Heritage Area, via which Carmichael coal will be exported.

MSCI may have joined the dots and shifted its controversy score, but many financiers are still avoiding the reality that financing one part of the Adani Group risks freeing up funds, either directly or indirectly, for Carmichael and other new thermal coal projects. 

BlackRock, Barclays, Deutsche Bank, Citi, DBS, Standard Chartered and JP Morgan have all publicly distanced themselves from the Carmichael coal project but continue to finance Adani Group companies. If they are genuine about their commitment they must cut all ties with the Adani Group now.

Additionally, Sustainalytics, another major ESG ratings company, needs to urgently review its questionable “low risk” ESG rating for Adani Ports, taking the Carmichael project into account.

Take action. Fill out the form to call for Sustainalytics to carry out an immediate reassessment of Adani Ports’ rating considering its serious climate, ecological and human rights impacts.


Call for Sustainalytics to carry out an immediate reassessment of Adani Ports’ questionable “low risk” ESG rating considering its serious climate, ecological and human rights impacts.

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