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Fossil fuel divestment has ‘zero’ climate impact, says Bill Gates

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Re: Fossil fuel divestment has ‘zero’ climate impact, says Bill Gates

#191

Post by scoot_718 »

strainer wrote: post #131
emckay wrote: post #118

Earlier quoted context omitted.

Here are the promised citations: 1. $10 trillion divested: https://gofossilfree.org/divestment/commitments/ 2. Chevron's shareholder proposal: https://www.asyousow.org/resolutions/2017/12/31/chevron-corp... 3. Chevron makes up about 1% of the S&P 500. 1% * 10% * $10 trillion = $100 million = 78 million shares of CVX at price during 2018 shareholder meeting 4. If 78 million shares voted YES on proposal instead of NO,…

Does this case extend to general advice though - that people should stay invested in fossil fuel companies in order to regulate them a bit? It should follow that if we invest more in fossil fuel extraction we can regulate them more. It seems to confound reasonable expectations of what results from investment.

Other than actual share rounds and shareholder meetings, the company doesn't actually see any result from investments.

Re: Fossil fuel divestment has ‘zero’ climate impact, says Bill Gates

#192

Post by scoot_718 »

dragonwriter wrote: post #163
patrickthebold wrote: post #132

Earlier quoted context omitted.

I think it's important to note that when you buy shares on the secondary market the company doesn't get any capital. You are just trading ownership for cash with the current owners. There's a somewhat subtle and pervasive assumption that all owners will seek only to maximize returns (or similar) but that notion really needs to go. Even with that assumption, it doesn't matter if you own shares in fossil fuel companies…

> I think it's important to note that when you buy shares on the secondary market the company doesn't get any capital. Companies are artificial abstractions. The people who invested in the company before you get money. If you consistently engage in a policy of engagement to deal with bad corporate citizens, you increase the positive financial rewards for earlier investors to use their governance influence to direct f…

Divestment makes the shares cheaper for less responsible investors, who thank you for the value you let them have for less money.

Re: Fossil fuel divestment has ‘zero’ climate impact, says Bill Gates

#193

Post by viraptor »

perfunctory wrote: post #184

> Those who want to change the world would do better to put their money and energy behind the disruptive technologies that slow carbon emissions and help people adapt to a warming world, Mr Gates told the Financial Times. You cannot put your money behind the disruptive technologies if your money is tied in fossil assets. You'll have to divest first before you can relocate it elsewhere. You can spend a dollar only onc…

The point was that these are separate actions. You can sell the oil shares and do whatever you want with the money - that doesn't change anything. You can use that money to invest in green alternatives - that's what matters.

Re: Fossil fuel divestment has ‘zero’ climate impact, says Bill Gates

#194

Post by shinryuu »

emckay wrote: post #20

Divestment also results in less shareholder oversight of emission heavy companies because environmentally conscious investors are selling their shares to investors with less scruples. This isn't just theoretical. According to Fossil Free, asset managers with about 10 trillion under management have committed to divesting. If you assume 10% of that is tracking something like the S&P 500, then these investors have sold…

How succesful is the track record of shareholder proposals in general?

Re: Fossil fuel divestment has ‘zero’ climate impact, says Bill Gates

#195

Post by shinryuu »

throwaway_oil wrote: post #144
emckay wrote: post #20

Divestment also results in less shareholder oversight of emission heavy companies because environmentally conscious investors are selling their shares to investors with less scruples. This isn't just theoretical. According to Fossil Free, asset managers with about 10 trillion under management have committed to divesting. If you assume 10% of that is tracking something like the S&P 500, then these investors have sold…

Divestment or investment due to ESG score goals is effective. Internal decisions at F500 oil & gas companies are being made with ESG in mind due to the amount of capital increased scores open up. Source: work for an oil & gas company

Do you know why Bill Gates would go out and tell it is ineffective?

Re: Fossil fuel divestment has ‘zero’ climate impact, says Bill Gates

#196

Post by yes-except-no »

emckay wrote: post #20

Divestment also results in less shareholder oversight of emission heavy companies because environmentally conscious investors are selling their shares to investors with less scruples. This isn't just theoretical. According to Fossil Free, asset managers with about 10 trillion under management have committed to divesting. If you assume 10% of that is tracking something like the S&P 500, then these investors have sold…

>typed this from my phone on a plane

This kinda defeats the whole "environmentally conscious" point.

Re: Fossil fuel divestment has ‘zero’ climate impact, says Bill Gates

#198

Post by hannob »

emckay wrote: post #20

Divestment also results in less shareholder oversight of emission heavy companies because environmentally conscious investors are selling their shares to investors with less scruples. This isn't just theoretical. According to Fossil Free, asset managers with about 10 trillion under management have committed to divesting. If you assume 10% of that is tracking something like the S&P 500, then these investors have sold…

This comes down to the question whether you should do change "from within".

There are probably cases where there's a reasonable case to do such a thing, e.g. if you have an electricity company that has a somewhat balanced mixture of fossil and renewable energy.

However I don't think this is a sensible approach if we talk about pure or almost pure fossil companies. There's no way Chevron can be "part of the solution". It's either these companies disappear or the planet will become uninhabitable, there's no middle ground on that. The idea that they can reform themselve has been a lie the oil industry has been peddling for a while. More than a decade ago BP said that now stands for "Beyond Petroleum". We can see how well that went.

Re: Fossil fuel divestment has ‘zero’ climate impact, says Bill Gates

#199

Post by Udik »

parasubvert wrote: post #173
Udik wrote: post #70

For a start, I can't even understand what is exactly the point of advocating any action against fossil fuel companies. After all, those companies only exist because we , directly or indirectly, buy their products. And we buy their products because they're cheaper than the alternatives, or even irreplaceable. It's as if everybody were asking the government to take action against the supermarket where we all do our gro…

It’s largely driven by people that don’t want to work within the market, they want to break the market, by starving supply / making it illegal. This tends to just lead to higher prices, black markets, riots, and right wing populist governments, but what do I know.

The end result of any successful action to curb fossil fuel consumption will be (at least at the beginning) an increase in the price of products depending on them. So why don't people ask directly for more taxes on those products, to drive the demand towards better alternatives?

It seems to me that the people don't want to take their share of responsibility and accept that the they'll have to bear the costs of the solution; and instead crave for some sort of empty vengeance on the companies whose products they keep buying.

Re: Fossil fuel divestment has ‘zero’ climate impact, says Bill Gates

#200

Post by ClumsyPilot »

graeme wrote: post #19
rocqua wrote: post #15

Earlier quoted context omitted.

Prices are set by supply and demand. Divestment reduces demand. Probably, the falling prices also increase demand, but fundamentally, if fewer people want something the price should drop.

Does this work in liquid markets though? Demand could obviously drive up price beyond fundamental value in a bubble, or below fundamental value in a panic. But in the ordinary course of things, we would expect the price of a security to match its value in the long run. If you are a rational, amoral investor, and you see a security worth $100, you would be prepared to pay up to $100 for it, and to buy it in as large a…

There is no 'Fundamental value'. The price is only determined by supply and demand.

Companies are traded with wildly different valuation to profit ratios, perception of stability, speculation of future profit, and even ethics. For example look at TSLA valuation compared to revenue, and compare it to any other car company. Stock prices also go up after governments print money, because banks have spare cash to invest but the economics of an individual company have not changed.

At the end of the day an investor can't calculate fundamental value, there is no agreed formula for it.

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