Will investors use their bond power?

The document advocates for a shift in investor strategy from traditional shareholder engagement to the use of bond markets as a strategic lever for climate action. It highlights that corporate bonds represent approximately 41 trillion USD and provide a critical point of influence during capital rounds. The author specifically calls for investors to refuse bonds from companies developing new fossil fuel projects and identifies the Samcheok coal plant project in South Korea as a key test case for this approach.

• Traditional shareholder engagement tools, such as filing resolutions and voting, are described as time-consuming and having resulted in "insubstantial and very slow progress" in addressing the climate crisis.
• Bond markets offer greater leverage than equities because companies are more receptive to feedback and strategy adaptation during capital rounds when they are seeking cash. Corporate bonds currently account for approximately 41 trillion USD.
• Bondholder influence is particularly critical for the world's largest greenhouse gas emitters that are state-owned, such as Gazprom, Abu Dhabi National Oil Co, PEMEX, and Saudi Aramco, because private sector shareholder engagement is impossible in these cases.
• The document proposes that investors committed to 2050 carbon neutrality should refuse bonds from companies that do not provide "legally-binding covenants" featuring independently verifiable "net-zero" action plans aligned with the bond's lifetime.
• The Samcheok project, a 2,100 MW coal plant in South Korea planned by Pospower, is identified as a test for investor climate coherence. The project is approximately 25% built and requires an additional 800 million USD, with a new bond issuance scheduled for March 2021.

APA

admin (2020). Will investors use their bond power? Reclaim Finance. https://reclaimfinance.org/site/en/2020/12/03/will-investors-use-their-bond-power/

Chicago

admin. Will investors use their bond power? Reclaim Finance, 2020. https://reclaimfinance.org/site/en/2020/12/03/will-investors-use-their-bond-power/.

Wikipedia

{{cite press release |last1=admin |title=Will investors use their bond power? |publisher=Reclaim Finance |date=3 December 2020 |url=https://reclaimfinance.org/site/en/2020/12/03/will-investors-use-their-bond-power/ |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@misc{admin2020will, author = {admin}, title = {{Will investors use their bond power?}}, publisher = {Reclaim Finance}, year = {2020}, month = dec, url = {https://reclaimfinance.org/site/en/2020/12/03/will-investors-use-their-bond-power/}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }