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David Solomon, Goldman Sachs’ chief executive, stated last month that his company would continue to fund fossil fuel companies. He stressed that not doing so would result in much higher prices. “We have to balance good public policy with the short-term implications and that’s why it is a transition,” he said. “If we’re too aggressive in the context of how we direct capital to the private sector, that can be more inflationary.”
Supporters of the divestment movement see attributing high energy prices and the push to reduce fossil fuel funding as a cynical attempt undermine what they claim is an important part in the solution to the climate crisis.
“Blaming divestments for high prices and energy shortages is really a red herring,” said Ben Cushing, who runs the Sierra Club’s Fossil-Free Finance campaign. “The reality is that oil and gas are volatile, global commodities and exist in a global market that is in flux for a lot of different reasons.”
Henry Fernandez, chief executive at MSCI, a financial service company that offers E.S.G., is Henry Fernandez. Products, suggested that finance companies were blaming social and environmental concerns for high energy prices to excuse their lagging performance.
“The asset managers are under pressure not to support oil and gas investments, and they know that the transition is difficult and entails risks, and that they may underperform,” he said. “So they are pointing to E.S.G. They can take a break and point to E.S.G. as the culprit. That is not what the world needs.”
And still, fossil fuel production will be with us for years to come, and senior banking executives are adamant that it is in the world’s best interest that major financial firms continue to support it. Many fossil fuel companies could be privatized without investment from large institutional investors, resulting in less transparency and accountability as well as higher emissions.
“We can’t have simple edicts like: No more fossil fuels. It’s just not practical,” Bill Winters, the chief executive of Standard Chartered, said in an interviewBloomberg Television last month. “We’re going to be dependent on fossil fuels for the next 15 or 20 years, unless there’s some miraculous technology breakthrough.”
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