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Here are the top 10 investors with the power to move the world away from fossil fuels

A new analysis suggests that climate activists should put pressure not just on fossil fuel companies—but also on their owners.
August 30, 2022

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Just 10 shareholders own nearly half of the potential carbon emissions controlled by the world’s largest fossil fuel companies, according to a new analysis. The findings suggest that targeted actions by these shareholders—and public pressure on those investors—have the potential to shape a transition to a low-carbon energy system.

Past studies have shown that control of global fossil fuel resources is highly concentrated: 200 companies own 98% of the world’s oil, gas, and coal reserves. These reserves represent 674 gigatons of potential carbon emissions—three times the remaining carbon ‘budget’ available to stay within 1.5 °C of warming.

The new work takes the analysis a step further by asking who owns the companies that own the fossil fuel reserves. The idea is that by providing financing for energy development, capital markets in the coming years can either disrupt the existing fossil fuel system—or lock it in place.

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“We cannot achieve a low-carbon transition without concerted action from a small and powerful group of shareholders,” says study team member Truzaar Dordi, a graduate student at the University of Waterloo in Ontario, Canada. “These shareholders have an outsized influence on the 200 largest publicly traded fossil fuel firms, [whose] activities alone would surpass our global carbon budget.”


Network model of the direct and indirect shareholders with greater than 1% ownership in the Carbon Underground 200. Red nodes represent fossil fuel companies. Black nodes represent shareholders. The thickness of the blue edge between nodes represents the relative size of holding. From Dordi T. et al.


Dordi and his collaborators gathered data on the largest fossil fuel companies from Carbon Underground 200 (CU200). They assembled data on shareholders in those firms from the financial data software system Bloomberg Terminal. They identified 730 shareholders with at least 1% equity in one or more fossil fuel firms, and an additional 188 indirect shareholders in the companies that own equity in fossil fuel firms.

They then conducted a network analysis of fossil fuel firms and their shareholders, tracing a total of 1,691 connections among 913 firms and shareholders.

“Network structures vary considerably across shareholder types,” the researchers report in the journal Environmental Innovation and Societal Transitions. “Investment advisors may have more numerous but smaller holdings in multiple firms, while governments may have large holdings in a few firms.”

Some fossil fuel companies, such as Saudi Aramco, have just a few owners with large stakes. Others, such as Yanzhou Coal Mining, have one large shareholder and a handful of smaller shareholders. Still other firms, including BP, Chevron, and Royal Dutch Shell, have many shareholders all with small ownership stakes.

“It’s important to understand the type of influence the shareholder has when advocating for change,” Dordi says. “Large shareholders like governments and high net worth individuals can influence the governance of just a few fossil fuel firms. Smaller shareholders can collectively drive systemic change in the industry as a whole through coordinated engagement.”

Using a combination of the size of holdings, potential emissions associated with those holdings, and connections to the overall network, the researchers came up with a list of the shareholders with the greatest potential to influence corporate governance of fossil fuel firms.

The top 10 owners include investment advisors, sovereign wealth funds and state-owned corporations, and governments: Blackrock, Vanguard, the Government of India, State Street, the Kingdom of Saudi Arabia, Dimensional Fund Advisors, Life insurance Corporation, Norges Bank, Fidelity Investments, and Capital Group. Together these 10 investors’ ownership stakes are associated with 49.5% of the potential emissions from the world’s largest fossil fuel firms.

“We also assert that financiers that don’t act in line with the low-carbon transition should be held accountable for the propping the economic activities that contribute to climate instability,” says Dordi.

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How might individuals and climate organizations accomplish that accountability? “Individuals and citizens could demand that their government to stop financing new fossil fuel projects in firms they have a sizable stake in,” he suggests. “Beneficiaries like pension fund holders could demand that their financial managers reduce their exposure to the fossil fuel industry as a whole.”

Source: Dordi T. et al. “Ten financial actors can accelerate a transition away from fossil fuels.” Environmental Innovation and Societal Transitions 2022.

Image: Anthony Quintano via Flickr

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