March 19, 2007

Ethical Funds report evaluates oil and gas sector's response to climate change

Only two Canadian companies are responding appropriately to the risks presented by climate change, says a new research paper from Ethical Funds. While Canada's oil patch is home to several world-leading companies, Ethical Funds' latest Sustainability Perspectives paper concludes that only Shell Canada and Suncor are well-positioned to function in a more carbon-neutral environment.

"We believe that all facets of society - government, corporations, and citizens - can and should play a role in tackling climate change, but the response of the oil and gas sector is crucial," said Bob Walker, Ethical Funds' vice-president of sustainability. "With effective action and the right market incentives, this sector can be viewed, not as the enemy, but as a key ally in tackling climate change."

Titled "Head in the Oil Sands? Climate Change Risks in Canada's Oil and Gas Sector," the research paper analyzed 48 Canadian oil and gas companies, plus two global leaders on climate change, BP plc and Royal Dutch Shell, in order to establish an international best practices benchmark. Companies were assessed on their management systems, action plans, performance, and transparency to determine the extent to which they are preparing for the future. Only four of the 50 companies assessed, including two of the 48 Canadian companies, were found to be responding appropriately to the risks presented by climate change.

The paper goes on to offer practical guidance both to companies at risk and investors seeking to integrate climate change performance metrics into their investment decision-making. It notes that "companies need to take immediate action steps to reduce their risk exposure, while investors need to support companies taking these steps and provide appropriate incentives to those which have yet to take action."

"We hope the Canadian oil and gas sector will use this report to unite in a process to stabilize emissions, achieve carbon neutrality and, in the decade to come, make the transition to a carbon-free energy system," said Walker.

Ethical Funds has been managing socially responsible mutual funds since 1992. It evaluates investments based on their social and environmental, as well as financial, performance and outlook, and gives investors a voice in encouraging sustainable business practices.

More information is available from Carol Boutin at Ethical Funds, 604/714-3997, Web site www.ethicalfunds.com.

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