The responsible investordgue to climate change

The guide examines the dilemma facing institutional investors regarding fossil-fuel holdings, weighing the merits of divestment against active shareholder engagement. It proposes a four-question framework for investors to evaluate whether a company's policies and business plans are consistent with limiting global warming to 2° Celsius, suggesting that divestment is justified if companies fail to provide convincing answers.

• Divestment from oil, gas, and coal is presented as a viable strategy based on financial self-interest, as the fossil-fuel industry is expected to be a poor investment during the shift to renewables, and as a means to increase the cost of capital for irresponsible firms.
• An alternative to divestment is active shareholder engagement, where institutional investors use their ownership and public influence to persuade companies to adopt climate-safe policies.
• The authors propose four criteria for investors to determine if a fossil-fuel company should remain in a portfolio: public subscription to the 2° Celsius warming limit, pledging to leave lobby groups that oppose climate policies, ending exploration of unconventional reserves (such as the Arctic or Canadian oil sands), and demonstrating viability during the low-carbon transition.
• The document highlights a gap in university endowment management, noting that while many institutions have ESG (environmental, social, and governance) committees, few have applied these principles to their fossil-fuel holdings.

APA

Sachs, J. D., & Sachs, L. (2015). The responsible investordgue to climate change. World Economic Forum. https://www.weforum.org/stories/geo-economics-and-politics/the-responsible-investors-guide-to-climate-change/

Chicago

Sachs, Jeffrey D., and Lisa Sachs. The responsible investordgue to climate change. World Economic Forum, 2015. https://www.weforum.org/stories/geo-economics-and-politics/the-responsible-investors-guide-to-climate-change/.

Wikipedia

{{cite report |last1=Sachs |first1=Jeffrey D. |last2=Sachs |first2=Lisa |title=The responsible investordgue to climate change |publisher=World Economic Forum |date=30 January 2015 |url=https://www.weforum.org/stories/geo-economics-and-politics/the-responsible-investors-guide-to-climate-change/ |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{sachs2015responsible, author = {Sachs, Jeffrey D. and Sachs, Lisa}, title = {{The responsible investordgue to climate change}}, institution = {World Economic Forum}, year = {2015}, month = jan, url = {https://www.weforum.org/stories/geo-economics-and-politics/the-responsible-investors-guide-to-climate-change/}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }