Urgewald: Financial Backers of Global Coal

Commercial bank support of coal industry from 2016 to 2019

A groundbreaking report finds that U.S. investors account for 58% of institutional investments in the global coal industry.

This February 2021 report, published by Urgewald, Reclaim Finance, Rainforest Action Network, Japan and 25 additional NGO partners, details the financiers and investors behind the global coal industry. “This is the first time anyone has attempted to analyze commercial banks’ and institutional investors’ exposure to the entire coal industry. In past years, the scope of our financial research was limited to around 200 coal plant developers. Our new research, however, analyzes financial flows to all 934 companies on the Global Coal Exit List,” said Katrin Ganswindt, head of financial research at Urgewald.

The report finds that as of January 2021, 4,488 institutional investors held investments totaling US$ 1.03 trillion in companies operating along the thermal coal value chain. Among the investors covered by the NGOs’ research are pension funds, mutual funds, asset managers, insurance companies, hedge funds, commercial banks, sovereign wealth funds and other types of institutional investors.

The world’s largest institutional investor in the coal industry is the US mutual fund company Vanguard, with holdings of almost US$ 86 billion. It is closely followed by BlackRock, which holds investments of over US$ 84 billion in the coal industry. Together, these two investment giants account for 17% of institutional investments in the global coal industry. Overall, U.S. investors are the single largest provider of institutional investment to companies on the Global Coal Exit List. With shares and bonds in value of US$ 602 billion, U.S. investors collectively account for 58% of institutional investments in the global coal industry.

The report also finds that commercial banks are channeling more money to the coal industry than in 2016, the year after the Paris Climate Agreement was signed.

Urgewald is a German nonprofit organization that makes the financing of environmental destruction and human rights violations visible and names those responsible. Read other reports from Urgewald here.