• James Hamilton

Money Talks

In our previous blogs we have outlined new types of training requirements that the Energy Transition will need for Net Zero to be achieved safely and we have also looked at different types of sectors that will require new strategy, training and skills to take advantage of the economic opportunity that the Energy Transition will bring. January of each year gives us the opportunity to examine one of the drivers of the momentum behind the Energy Transition as Larry Fink, Chairman and CEO at BlackRock, one of the world’s largest asset managers writes to CEOs to share the expectations of the financial powerhouse for the coming year.

Now, before diving into some of the details of the 2021 letter we thought it would be useful to do a quick recap of some of the major takeaways from the 2020 letter. We can pick out some interesting highlights. In January 2020 we were all in a pre Covid 19 world and BlackRock had just laid out Climate Change and sustainability as requirements for organisations in which they would invest. Further to this Fink had stated that BlackRock would start voting against firms not accepting sustainability as the new standard and actively working towards it. A fairly strong statement as the 2019 Fink letter had not even mentioned Climate Change. Some commentary had questioned whether this new BlackRock was serious about Climate Change and Sustainability and some no doubt still do.

What we can ascertain immediately is that the 2021 letter demonstrates a stark increase in sustainability and Net Zero expectation and required action from the investment community and also a huge increase in the pace of the transition from a financial perspective. BlackRock have increased their investment in sustainable assets by 96% since 2019. Fink points out that the Covid 19 pandemic may well have made us realise our fragility and demonstrated that fronting up to global challenges requires an ambitious response. He goes on to outline that business leaders and boardrooms will have to define and provide transparent plans for demonstrating durable sustainable value, and failure to do so and to neglect a strategic approach to achieving Net Zero will directly affect stock value.

At Coeus Energy we find the messaging of the Fink 2021 letter to CEOs engaging as we routinely discuss the risk of organisations and society being left behind by the pace of the Energy Transition. There is an opportunity to align with the reallocation of investment and the huge economic benefits that will come with the Net Zero journey. But it will take courage - courage from decision makers within the public and private sectors and individuals to reach out and engage with it. Not wait for it.

Coeus Energy was established in 2020 to help Inspire, Inform and Enable the Energy Transition. Contact us to see how we can help you with your training and Net Zero project requirements., ,

Read the letter:

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