21 September 2021
Last week Responsible Investor, in partnership with Market Forces, hosted a webinar entitled Adani Group’s new coal projects: why and how investors need to act. Hundreds of employees of financial institutions, based mainly in Europe and the US east coast were in attendance.
Combined, the presentations from the four panel speakers built the case and the methodology for cutting ties with the entire Adani Group, in order to avoid supporting its many new fossil fuel projects, and in particular the Carmichael thermal coal project in Australia.
Tim Buckley from IEEFA began the webinar by demonstrating the interconnected nature of the entire Adani Group and warning that financiers could not realistically ring-fence financing to one part of the group. He also highlighted the huge energy transformation underway in India, with its 450GW by 2030 renewable energy target, and warned that Adani’s new coal plants could increase the price of electricity for Indian (and in the case of Godda, Bangladeshi) consumers.
“The idea that an investor or lender can invest in one arm and think they are making a quarantined investment separate to the whole is a total fiction, an act of faith contradicted by the facts. The Adani family has total control via majority stakes in each arm. Inter-company transactions, loans and transfers are myriad.”Tim Buckley
Pablo Brait from Market Forces then presented research, published earlier this year, which compiled all of Adani Group’s new fossil fuel projects. This data shows Adani is planning a massive increase in thermal coal mining and a doubling of its already huge coal-fired power capacity. It proves that, although investments in renewables have been made, the Adani Group is not transitioning away from fossil fuels, but rather it’s expanding in all directions.
“You cannot be a company shifting away from fossil fuels while building new fossil fuel infrastructure.”Pablo Brait
Mr Brait went on to explain why Adani’s climate-wrecking Carmichael thermal coal project in Australia was of global significance, as it will help open up the untapped Galilee Basin and blow humanity’s carbon budget. Finally, he foreshadowed Adani’s alignment plan with the IEA’s net zero by 2050 scenario, and put forward three points it must include (including the cancelling of the Carmichael project) in order to be taken seriously.
“Thanks in part to the Galilee Basin mine proposals, Queensland is the state or province with the biggest proposed coal mining capacity on Earth. My point again is that this is a global problem, not an Australia problem. Every person and financial institution looking to prevent catastrophic climate change needs to help keep Galilee Basin coal in the ground.
“By retaining ties to the Adani Group, investors and banks are risking supporting the Carmichael coal project and other new fossil fuel projects. So be warned! If you don’t want to be associated with Carmichael, then all ties to the Adani Group must be cut, until Carmichael is abandoned.”Pablo Brait
Peter Lööw of Alecta told the story of how an indirect link to the Carmichael coal project (via Amundi’s ownership of State Bank of India green bonds) forced it to act. This action culminated in Amundi divesting itself of the SBI green bonds, when SBI refused to take its proposed loan for the Carmichael project off the table.
And finally, Yann Louvel from Reclaim Finance (replacing colleague Lucie Pinson who was unable to attend) took the audience through an analysis of financial institution climate policies and pointed out the loopholes, gaps and discrepancies that meant so few were able to successfully exclude the Adani Group and its subsidiaries, despite committing not to finance new thermal coal mines or power stations. Mr Louvel specifically pointed to Standard Chartered, Barclays, JP Morgan, Deutsche Bank and BlackRock as examples of financiers supporting the Adani Group despite having (obviously inadequate) policies that exclude thermal coal.
Reclaim Finance’s list of what a coal exclusion policy must include is:
- Exclusion of all companies developing new coal projects.
- Use the correct metrics to measure coal exposure.
- Exclusion of all groups and subsidiaries listed on the Global Coal Exit List.
- Apply the policy to all assets under management.
Reclaim Finance’s Coal Policy Tool has more.
Take action: contact Adani Group’s key investors and bankers and ask them to cut ties.