Escalating the pressure: ESG investors move from talk to action

War in Europe has completely upended the narrative around energy transition. Corporates and their banks are now engaged in a more complex conversation around the production – and financing – of oil and gas to replace Russian supplies. This could translate into more aggressive shareholder action as ESG investors fight to keep their near-term green agenda on track.

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The Russian invasion of Ukraine may achieve what years of global agreements, protests and investor engagement have not been able to – to turn Europe away from fossil fuels and exponentially ramp up investment in renewable energy.

“I believe at the European level it will increase the pace of investment to renewables to be less dependent on Russian gas,” says Francois Humbert, active ownership lead manager at Generali Insurance AM.

Despite concerns that short-term fixes to reduce dependency on Russian gas include increases in fossil fuel production elsewhere, the medium- to long-term direction is firmly towards renewables.

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