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Global warming is now biggest issue for airline investors

By Charlotte Ricca

Flightshaming movement grows in influence

Climate change is now top of the agenda for airline investors, says the International Air Transport Association (IATA).

Speaking at the Airlines 2050 conference in London, IATA chief economist Brian Pearce discussed research by HSBC, which looked at the number of times climate issue was discussed on European airline calls with investors.

The report reveals a “substantial spike”, with climate issues coming up an average of seven times in 2019, compared with less than once per call between 2013 and 2017.

Pearce said this was proof “climate change is not just an issue for protesters or scientists”.

“This is on the top of the agenda for mainstream investors now. We’re getting pressure from all quarters,” he said.

The IATA believes investors are worried about the flight shame movement in Scandinavia and the impact it could have on travel.

According to Vaughan Lindsay, CEO at ClimateCare, flight shaming has already seen a 15 per cent drop in Swedish domestic flights.

“Air travel is a large contributor to global emissions making up 2 per cent of human-induced carbon emissions and 12 per cent of all transport emissions,” Lindsay said. “Many more people are starting to question whether they should fly, and if they truly have to, how they can offset their flights emissions.”

Some airlines are stepping up and taking action. British Airways has promised to achieve net-zero emissions by 2050, by offsetting all domestic flight emissions from next year, at a cost of $3m (£2.4m) a year.

There is also CORSIA (Carbon Offsetting and Reduction Scheme for International Aviation), which requires all carriers to report their yearly CO2 emissions.

CORSIA has forecast it will alleviate around 2.5 billion tons of CO2 and generate over $40 billion in climate finance between 2021 and 2035.

IATA said: “Airlines are already taking the issue seriously, as shown by their commitment to CORSIA and investment in sustainable alternative fuels. But it looks, for Europe at least, as though pressure from investors will become an additional incentive for decarbonisation.”

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