Groups call for divestment from Marubeni Corporation, a major global supporter of coal-fired power plant construction
Friends of the Earth Japan
Japan Center for Sustainable Environment and Society (JACSES)
(Tokyo, 31 July 2018)
The trend to expand and intensify the divestment from coal is accelerating globally, since the December 2017 action by AXA. 2 major insurers Allianz and Generali, as well as 5 other insurers followed the French insurance giant and announce the exclusion of coal plant developers from their portfolio. The “Global Coal Exit List ” database released in November 2017 by the Germany-based environmental NGO Urgewald is an important reference source for these efforts. The list includes large Japanese electrical utilities as well a major Japanese trading company named Marubeni Corporation.
Among Japan’s top trading companies, Marubeni has the largest involvement in electricity generation, and it actively involved in the construction and other aspects of coal-fired power plants both in Japan and abroad. According to Urgewald, Marubeni was involved in 2017 in construction projects for new coal-fired power plants in nine countries totaling 13,620 megawatts, and on Urgewald’s list of the “Top 120 Coal Plant Developers,” this ranks Marubeni 11th among companies all over the world, and the 2nd one spot behind Korea Electric Power Corporation (KEPCO) among developed countries.
Today (July 31, 2018), the U.S. research organization Institute for Energy Economics and Financial Analysis (IEEFA ) released its “Marubeni’s Coal Problem A Japanese Multinational’s Power Business Is at Risk” report based on an analysis of Marubeni’s coal business. The report states Marubeni could assert itself as a clean energy leader worldwide if it fully embraces the global transition to clean energy and give up its development plans in the coal sector.
Marubeni is likely to face more and more financial and reputational risks while a growing number of finance actors are adopting policies restricting their support to the coal sector. While some companies already struggle to finance their coal-related activities, they could soon face challenges to insure them. World reinsurer Swiss Re announced early July the end of its underwriting support to coal. Four other major insurers have adopted a no-coal policy covering their underwriting activities.
Based on these facts, in June 2018 a group of 21 Japanese and international environmental NGOs concerned about climate change wrote 39 major investors and lending institutions (9 Japanese, 30 overseas) providing information (summary sheet) and calling on them to divest from Marubeni which promote global coal projects the most as a Japanese company. These materials were accompanied by fact sheets on six of Marubeni’s current coal-fired power plant projects in Japan and overseas that have been identified as being problematic.
Marubeni’s promotion of coal plant developments around the world bucks the trend of global efforts for decarbonization. If the world is to limit global warming to well below 2°C as agreed under the Paris Climate Agreement, we can no longer afford to build new CO2-emitting coal plants. Also, building new coal plants in economically-emerging countries in Southeast Asia or other regions means locking them into coal dependency or decades to come. Banks, insurers and other investors which fail to end all support to Marubeni and other coal plant developers also face to be targeted by civil society ahead and beyond COP24. Among Marubeni’s top investors and financiers, are BlackRock, ABP, a Dutch public employee pension fund, and the US and Australian banks Citi and ANZ. More surprisingly, French banks such as Crédit Agricole and BNP Paribas also rank among the first financiers of the coal developer, a position inconsistent with their allegedly pro-climate positions.
Note: The Marubeni divestment request letter and related materials were prepared by the three lead organizations listed below with participation from 18 environmental organizations and other group from around the world. Please see the letter (PDF) for the full list.
Summary sheet: “Why Marubeni: Why and how investors should divest from and/or exclude Marubeni”
Fact sheets: 1. Cirebon (Indonesia), 2. Pagbilao (Philippines), 3. Thabametsi (South Africa), 4. Morupule B (Botswana), 5. Nghi Son 2 (Vietnam), 6. Akita Port (Japan)
- Press Release: New IEEFA Report Coal-exposed Marubeni must embrace global renewable shift
Link to IEEFA report: Marubeni’s Coal Problem A Japanese Multinational’s Power Business Is at Risk
Hozue Hatae, Development and Environment Team Leader, Friends of the Earth Japan email@example.com
Yuki Tanabe, Program Director, Japan Center for Sustainable Environment and Society firstname.lastname@example.org
Kimiko Hirata, International Director, Kiko Network email@example.com