Erste Asset Management

Divesting oil – personal preface included

Divesting oil – personal preface included
Divesting oil – personal preface included
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When I think back to my first school outing to the refinery in Schwechat (Lower Austria), the first thing that comes to mind are the excellent wiener sausages at the canteen. The highly complex processes involved in the refinement of crude oil, on the other hand, are hard to digest even for an adult.

Divesting oil – personal preface included

Some interest in crude oil was always going to be congenital in my case. After a quick detour to Vienna, I grew up on the biggest oilfield of Central Europe. My granddad was a very successful drilling foreman during the Russian occupation (and beyond), at a time when workplace safety standards were not even a thing on television. Winters were still real (i.e. below-zero) winters, where some of the oil was dumped into pits and set on fire in order for the workers not to freeze to death.

Luckily my dad chose the same sector, because that’s where he met my mother. In contrast to my granddad, however, he did not become a technician, but embarked on a career with OMV.

Why this personal preface? As Head of the ESG Department with Erste AM, I – together with my team – took a radical decision earlier this year: divesting oil from our – Austrian Ecolabel-awarded – sustainability funds.

Dialogue or exclusion? Both!

Crude oil companies can be excluded for ethical and moral reasons. For example, you do not want to participate in companies via your fund that are among the biggest greenhouse gas producers and thus contribute significantly to climate change.

The exclusion can also be based on risk aspects, e.g. compliance (or lack thereof, respectively) with the goals of the Paris Agreement. There will be an increasing number of restrictions with regard to the use of fossil fuels in order to contain global warming below 1.5 degrees relative to the pre-industrial age.

You do not want companies in your portfolio where you can expect large losses on a sustainable basis due to so-called stranded assets (i.e. crude oil reserves that, while itemised on the balance sheet of the company, cannot be extracted due to climate change regulations).

Regardless of the motivation for the exclusion of crude oil companies, the decision entails that the companies affected have become uninvestable for your fund.

Achieving a change of heart at AGMs

Divestment would, however, also mean losing the chance to make use of our shareholder rights at the Annual General Meetings (AGMs) of oil companies and thus the platform to exert pressure for change, which is an even bigger lever for the transformation of the economy than criteria of exclusion.

Since 2015, we have used our voting rights on the basis of our own sustainability policy for all funds of Erste AM (N.B. that includes traditional funds). This means we will maintain the highly constructive dialogue with OMV (where we are lead investor of the international investor association Climate Action 100+).

Sustainability pioneer in Austria

Since Erste AM therefore has the opportunity to combine the best of both worlds, it was an easy decision to already comply with the new regulations of the Austrian Ecolabel voluntarily at this early stage. Thus, we remain on the path that we chose in 2001 as pioneer and market leader.

We hope you will enjoy reading this new ESG Letter and wish you sufficient levels of (non-fossil) energy in the coming difficult days.

You can find our dossier on rethinking energy production and consumption at:


Legal note:
Prognoses are no reliable indicator for future performance.



Legal disclaimer

This document is an advertisement. Unless indicated otherwise, source: Erste Asset Management GmbH. The language of communication of the sales offices is German and the languages of communication of the Management Company also include English.

The prospectus for UCITS funds (including any amendments) is prepared and published in accordance with the provisions of the InvFG 2011 as amended. Information for Investors pursuant to § 21 AIFMG is prepared for the alternative investment funds (AIF) administered by Erste Asset Management GmbH pursuant to the provisions of the AIFMG in conjunction with the InvFG 2011.

The currently valid versions of the prospectus, the Information for Investors pursuant to § 21 AIFMG, and the key information document can be found on the website under “Mandatory publications” and can be obtained free of charge by interested investors at the offices of the Management Company and at the offices of the depositary bank. The exact date of the most recent publication of the prospectus, the languages in which the key information document is available, and any other locations where the documents can be obtained are indicated on the website A summary of the investor rights is available in German and English on the website and can also be obtained from the Management Company.

The Management Company can decide to suspend the provisions it has taken for the sale of unit certificates in other countries in accordance with the regulatory requirements.

Note: You are about to purchase a product that may be difficult to understand. We recommend that you read the indicated fund documents before making an investment decision. In addition to the locations listed above, you can obtain these documents free of charge at the offices of the referring Sparkassen bank and the offices of Erste Bank der oesterreichischen Sparkassen AG. You can also access these documents electronically at

N.B.: The performance scenarios listed in the key information document are based on a calculation method that is specified in an EU regulation. The future market development cannot be accurately predicted. The depicted performance scenarios merely present potential earnings, but are based on the earnings in the recent past. The actual earnings may be lower than indicated. Our analyses and conclusions are general in nature and do not take into account the individual characteristics of our investors in terms of earnings, taxation, experience and knowledge, investment objective, financial position, capacity for loss, and risk tolerance.

Please note: Past performance is not a reliable indicator of the future performance of a fund. Investments in securities entail risks in addition to the opportunities presented here. The value of units and their earnings can rise and fall. Changes in exchange rates can also have a positive or negative effect on the value of an investment. For this reason, you may receive less than your originally invested amount when you redeem your units. Persons who are interested in purchasing units in investment funds are advised to read the current fund prospectus(es) and the Information for Investors pursuant to § 21 AIFMG, especially the risk notices they contain, before making an investment decision. If the fund currency is different than the investor’s home currency, changes in the relevant exchange rate can positively or negatively influence the value of the investment and the amount of the costs associated with the fund in the home currency.

We are not permitted to directly or indirectly offer, sell, transfer, or deliver this financial product to natural or legal persons whose place of residence or domicile is located in a country where this is legally prohibited. In this case, we may not provide any product information, either.

Please consult the corresponding information in the fund prospectus and the Information for Investors pursuant to § 21 AIFMG for restrictions on the sale of the fund to American or Russian citizens.

It is expressly noted that this communication does not provide any investment recommendations, but only expresses our current market assessment. Thus, this communication is not a substitute for investment advice, does not take into account the legal regulations aimed at promoting the independence of financial analyses, and is not subject to a prohibition on trading following the distribution of financial analyses.

This document does not represent a sales activity of the Management Company and therefore may not be construed as an offer for the purchase or sale of financial or investment instruments.

Erste Asset Management GmbH is affiliated with the referring Sparkassen banks and Erste Bank.

Please also read the “Information about us and our securities services” published by your bank.

Subject to misprints and errors.

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