Here’s some news that caught my interest: CNN reported that oil and gas giants Shell and TotalEnergies are “considering abandoning their stock exchanges for Wall Street in a move that would deal a hammer blow to London and Paris.” Shareholders and executives “have recently expressed frustration with the low value of their stock compared with US oil majors, and floated the idea of moving the listing of their shares across the pond.”
Why would these stalwarts of the European capital markets consider moving their listings to the US? After all, Shell is the second-largest company on London’s FTSE 100 index, at 8.4% of its total market capitalization, and TotalEnergies is the fourth-largest listing on France’s CAC 40 index, making up 6% of its market capitalization. Lindsey Stewart, Director of Investment Stewardship Research at Morningstar, was quoted as saying:
“European shareholders ‘have raised the pressure on integrated energy companies (in Europe) to up their game on climate commitments and other (environmental, social and governance) issues in a way that perhaps isn’t the case in the United States.'”
If the companies move ahead with this, the US anti-ESG movement may try to claim a victory, but that is far too simplistic. Even so, as Shell and TotalEnergies continue assessing their options, there will be plenty of interesting analyses and discussions about the relationship between climate pressures, public policy, consumer behavior and investor returns in the EU versus those in the US. Stay tuned – I bet we’ll be hearing more soon.
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