Nature and Capital Markets, Stranding assets, stranding

business modelsMark CampanaleFounder and Executive Director,Carbon Tracker Initiative

www.carbontracker.org@carbonbubble #strandedassets

Understanding Carbon Budget

When will we break the carbon budget?

The Carbon Budget could be broken in a few decades

RESOURCES: the estimated amount of hydrocarbon contained in the depositRESERVES: the amount of resources that are technologically and economically feasible to extract

For more technical definitions, please visit www.carbontracker.org

Carbon budget deficit for listed companiesLess than 900 GtCO2 can be burnt to keep

global warming below 2 degrees Celsius

1990’s – race to list Asia’s logging industry

“Analysts say that (companies) feel that going public will provide some insulation from political uncertainties and from pressure on their activities by environmental group.”

Source: FT, June 7 1994

Attracted investment banker following

WI Carr Banque Indosuez issues stock coverage and buy/sell notes on 15 Malaysian and Indonesia companies with 18 million acres of forest concessions….

Source: WI Carr Malalysia/Indonesia Timber Industry August 1994

• Russia’s forests account for one fifth of the world’s timber resources and half of the temperate forest area.

• Russian Timber Group Annual Allowable Cut of 3.3 million m3 of Angarsk pine and Siberian larch.

• Over 2.4 million hectares (almost the size of Belgium) of forest land on harvesting leases

• Russia’s annual harvesting level is about 550 million m3

Russia largest untapped forest reserve in world

London 2007 IPO of 2.5 million hectares of Siberia (pulled)

Global equity markets - still much to discover eg: How much of the world’s unprotected forest is listed? Which companies own frontier forests? What is the current forest depletion rate and to what

extent is this conversion to plantation? How many industrial fishing fleets are publically listed? Where are they listed and how do they operate? Which banks and institutions are financing this?

Private capital markets and nature