Cement Companies Are Starting to Get a $33 Trillion Headache
- Climate group calls for 2050 carbon neutrality pledge
- Cement production accounts for 7% of global carbon emissions
The kiln at ENCI cement factory, part of the Heidelberg group, Maastricht, Netherlands.(AP Photo/Peter Dejong)
The world’s biggest cement makers have been under pressure from environmental groups, regulators and lawmakers to cut pollution. Now, some of the world’s most powerful investors are echoing those calls.
Members of the Institutional Investors Group on Climate change and the Climate Action 100+, a coalition of money managers with more than $33 trillion under management, is asking that European construction-material companies commit to a target of reducing net carbon dioxide emissions to zero by 2050. The group sent the demands to CRH Plc, LafargeHolcim Ltd, HeidelbergCement AG and Compagnie de Saint-Gobain SA, along with letters setting out steps applicable for each company on how to get there.
Just like industries from traditional power generation to shipping and transportation, pressure on is mounting on cement companies to clean up and help slow global warming. The industry accounts for 7% of the world’s man-made carbon dioxide, according to the International Energy Agency.
“Construction material companies may ultimately risk divestment and lack of access to capital,’’ said Vincent Kaufmann, chief executive officer of the Ethos Foundation, a member of the group. “An increasing number of investors seek to exclude highly carbon-intensive sectors from their portfolios to meet their own decarbonization plans.”
Click here to read a story on why greener forms of cement are difficult to sell.