Investors warn car makers to clean up their act

Tesla electric vehicle production line.

Major investors have warned the automotive industry it needs to accelerate its readiness for a low-carbon world if it is to retain their support and prosper.

Vehicle makers must put climate change specialists on their boards, engage better with policy-makers, and invest more heavily in low-emission cars, says a network of 250 global investors with assets of more than US$24 trillion.

The demands come in a new report, Investor Expectations of Automotive Companies, published this week by the Institutional Investors Group on Climate Change (IIGCC).

“Long-term investors want to ensure that automotive companies are prepared for the challenges stemming from climate change, new technologies, changing policies and shifts in demand caused by global trends,” says Dr Hans-Christoph Hirt, co-head of investment house Hermes EOS, a member of the IGCC.

“Investors expect the industry to embark upon a smoother route to future prosperity by developing and implementing long-term business strategies that are resilient to climate change and resulting regulatory shifts.”

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