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The majority of the turnover generated by the coal-production companies identified in the Fund's analysis derives from the sale of thermal coal. These companies face considerable climate-related financial risk, due to the negative environmental and health impacts of coal, which affect demand. Furthermore, coal-powered electricity production is subject to competition from gas and renewable energy. In the case of oil-and-gas companies, the Fund has identified a number of companies featuring substantial exposure in high-cost projects, such as oil-extraction from oil sands. The Fund believes these companies face serious climate-related financial risks and that it is highly likely that these projects may either be stranded or unprofitable.
At the Rockefeller Brothers Fund, there is no equivocation but there is caution, said Stephen Heintz, its president. The fund has already eliminated investments involved in coal and tar sands entirely while increasing its investment in alternate energy sources. Unwinding other investments in a complex portfolio from the broader realm of fossil fuels will take longer. “We’re moving soberly, but with real commitment,” he said. Steven Rockefeller, a son of Nelson A. Rockefeller and a trustee of the fund, said that he foresees financial problems ahead for companies that have stockpiled more reserves than they can burn without contributing significantly to climate damage. “We see this as having both a moral and economic dimension,” he said.