Australian Infrastructure Investor IFM to Exit Coal Investment by 2030

BY  
Seneca ESG  
- September 9, 2021

IFM Investors, one of Australia’s largest infrastructure investors, has pledged to phase out thermal coal from its infrastructure portfolio by 2030, as reported by Bloomberg on September 6. The infrastructure portfolio in question includes AUD75bn (USD56bn) of assets in toll roads, airports, and oil pipelines. In addition to the withdraw of coal assets, the Australian fund will not invest in new assets with more than 20% of revenue generated from coal. The move to cut coal from this portfolio aims to reduce at least 1.2m tons of annual carbon dioxide emissions. David Neal, CEO of IFM, said that sustainability targets for other portfolios in the company will be announced soon.

IFM manages AUD172bn (USD126bn) worth of assets across infrastructure, debt, stocks, and private equity. It is owned by 23 Australian pensions. The company has committed to reaching carbon neutrality for its portfolio by 2050 in October 2020 and has an interim target of reducing carbon emissions across its infrastructure portfolio by 40% by 2030.

IFM’s announcement to divest from coal comes as many asset managers and pension funds part ways with the most carbon intensive fossil fuel, including BlackRock , UK’s Pension Insurance Corporation, South Korea’s National Pension Service, and Australia’s Macquarie Group . The divestment commitment includes only direct emissions and excludes indirect emissions accounting for most of its carbon footprint, such as those by its customers. The company’s remaining exposure to thermal coal is limited to the Polish district heating business purchased in 2006. However, IFM also stated it has no plan to divest from oil and gas, in which the company has considerable holdings.

Sources:

https://www.bloomberg.com/news/articles/2021-09-06/infrastructure-giant-in-australia-maps-out-carbon-reduction-plan

https://www.reuters.com/business/sustainable-business/australias-ifm-investors-end-coal-exposures-by-2030-2021-09-06/

https://www.ifminvestors.com/about-us/media-centre/archive-us/!news/2020/10/11/ifm-investors-targets-net-zero-by-2050-us

https://www.reuters.com/article/southkorea-nps-idUSL3N2NF2HL

https://www.smh.com.au/business/banking-and-finance/not-viable-ifm-to-stick-with-oil-and-gas-but-dump-coal-on-path-to-net-zero-20210906-p58p7r.html

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