Boom of planet-friendly funds will impact companies' cost of capital -BlackRock
03/10/2019 10:29
JOHANNESBURG, Oct 3 (Reuters) - Huge flows of money into
investment funds labelled environmentally friendly will make it
more costly for some companies to access capital, BlackRock's
top mining sector investor said on Thursday.
Environmental, social, and governance (ESG) concerns have
become a buzzword in the financial sector and investment
products labelled ESG have multiplied, sucking up billions of
dollars and putting pressure on sectors considered "dirty" such
as oil and mining.
"The weight of money flowing into products in this area,
whether they are active or passive, will shift the cost of
capital for companies," said Evy Hambro, who manages the
BlackRock World Mining investment trust BRWM.L , addressing the
Joburg Indaba mining conference from London.
"It's only recently that we've been asked by clients in
almost every encounter with them what we're doing on ESG,"
Hambro said.
The actively managed BlackRock World Mining trust invests in
mining companies including BHP Group BHP.AX , Rio Tinto
RIO.L RIO.AX , Vale VALE3.SA and Newmont NEM.N , according
to its June 30 holdings report.
BlackRock, the world's biggest investment manager, has come
under fire this year for its investments in coal mining
companies.
(Reporting by Helen Reid; Editing by Tom Hogue)
((Helen.Reid@thomsonreuters.com; +44 20 7542 0402;))