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NRDC Partnership Produces First-Ever Stock Index Excluding Fossil Fuel Companies
Americans are worried about pollution—oil trains running through their towns, fracking in their neighborhoods, coal dust in their air. They’re worried about what the future will look like for their children if carbon pollution continues unchecked.
Wall Street is worried about it too. Under pressure from a growing movement of people who want their money out of fossil fuels, universities, pension investors and foundations are looking to exclude coal, oil and gas stocks from their portfolios. Until now, it could be hard to figure out if investments were free of fossil fuels: Large portfolios like retirement funds invest in multiple companies at once and might put money in oil, gas, or coal. As a result, well-meaning investors might find themselves holding so-called “passive” investments in the very companies they wanted to avoid.
For decades, NRDC has created and supported policies that will ultimately end our reliance on fossil fuels. Today, we are proud to announce that we are working to accelerate that change by helping to create an innovative investment solution that will aid investors who want to keep their money out of fossil fuel companies.
Over the last year, NRDC has partnered with BlackRock and FTSE Group, the global index provider, to launch the first stock market index to exclude fossil fuel companies—a new tool that will help ensure that climate-conscious investors can match their financial interests with their values.
A stock market index helps investors track the performance of a group of stocks. NRDC worked with FTSE to develop comprehensive and transparent methodologies that screen out companies linked to owning, exploring, or extracting fossil fuels. Now, investment companies like BlackRock will use the FTSE index to create low-cost portfolios for customers who don't want to invest their money in fossil fuel companies.
It’s a critical need. Foundations, universities, pension groups, and other major organizations that have wanted to get out of fossil fuel investments have a responsible path to do so—one that will allow them to continue to make money for their clients, but not at the expense of our air, water and climate.
Over the past six months, 80 percent of new electricity installed in the U.S. came from renewable energy. We are beginning to replace fossil fuels that endanger our health and climate.
Now, we need others to join us in the fight for a clean energy future. Demonstrating market demand for this index and related investment solutions will help support the growing movement to shift investments away from dirty fuels.
You can help: Tell your university, your company’s pension advisors, your place of worship: It is time to invest in a clean energy future. It is time to invest in our children’s future and do the work we must do to leave them the world they deserve.
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