We are an investor in a major Chinese oil company. The company is exposed to risks stemming from its carbon liabilities and its Canadian subsidiary increases the company’s vulnerability to such issues from a regulatory standpoint and financially in a low carbon scenario.
The company has implemented a low-carbon strategy and strives to promote clean energy and improve energy efficiency. The company invested special funds for energy conservation and emission reduction as well as promoted energy conservation and emission reduction via technological advances. They also implemented systematic energy conservation based on a clear and complete organizational structure.
However, the company did not have a clear reduction target or deadline for their greenhouse gas (GHG) risk management program despite that their industry peers did. During several group calls and meetings that we attended, these concerns were repeatedly raised.
Finally, during a press conference in June 2019, the group announced its Green Development Action Plan, which included targets to reduce carbon emission in 2020 back to levels of 2015 and to become a global leader in major indicators of low carbon emissions by 2050 (overall group target announced by the parent company).