Fossil Fuel-Free Investing

Impax invests in companies and assets that we believe are well positioned to benefit from the transition to a more sustainable economy.

For all of our strategies, we aim to build more resilient portfolios for our investors by managing risks, including climate-related risks. Specifically, we believe climate change poses material risks to fossil fuel companies in the form of expected government intervention to regulate greenhouse gases, changes in consumption patterns, and other liabilities, like stranded asset risk, reputational risk, and litigation risk.

In addition, a certain number of our strategies are “fossil fuel free”. Given the range of definitions in the marketplace we fully disclose Impax’s definition, providing additional transparency for investors, as set forth below:

Our definition of ‘Fossil fuel free’

Fossil fuel (thermal coal, oil and gas) – Energy Sector: exploration & production and refining & processing

Companies with >0% revenue or profits¹ derived from direct fossil fuel activities identified above will be excluded from the portfolio.

Storage and distribution sector: storage & distribution

Companies with >5% revenue or profits¹ derived from direct storage and distribution activities will ordinarily be excluded from the portfolio although companies may be included in the portfolio if the company has established itself as a leader in the transition to a zero-emissions energy economy with reduction targets, including Scope 1, Scope 2, and Scope 3, that are compatible with the Paris Agreement’s target of limiting future warming to 2⁰C, and has agreed to publicly report on progress. 

Utility power generation sector: coal, oil, natural gas

Companies with >5% revenue or profits¹ derived from the above power generation sector will ordinarily be excluded from the portfolio although companies may be included in the portfolio if the company has established itself as a leader in the transition to a zero-emissions energy economy with reduction targets, including Scope 1, Scope 2, and Scope 3, compatible with the Paris Agreement’s target of limiting future warming to 2⁰C, and has agreed to publicly report on progress. 

Green bonds

When we invest in a bond whose use of proceeds specifies that the funds raised will be used to finance renewable energy, or other activities consistent with a Paris-aligned transition to a low-carbon economy, we may invest in those bonds without regard to the issuer’s percentages of revenue or profits as described above.

Our fossil fuel free strategies

Impax Strategies