JP Morgan drops defence and petrol stocks on green grounds

AMERICA’S biggest bank JP Morgan has sold its holdings in two petrol and defence giants as pressure mounts on financiers to stop bankrolling firms that could be harming the environment.

JP Morgan American Investment Trust, which is London-listed and has £1.4bn worth of assets, said it was selling its holdings in Marathon Petroleum and Raytheon Technologies due to “poor ESG [environmental, social and governance] grounds” as scrutiny on investments by climate change campaigners ramps up.

The fund owned by the Wall Street bank, whose chief executive Jamie Dimon is coming to London next month for the first time since the pandemic began, said it now judges stocks using the United Nations Global Compact (UNGC) “severe violators” list, which Marathon and Raytheon are both on.

Marathon and Raytheon had not responded to a request for comment at the time of publication.

The bank said it is instead investing in natural gas firm Conocophillips and pharmaceutical company Bristol Myers Squibb as they have “better ESG credentials”.

Its decision to drop the stocks has emerged in the same week that hundreds of Extinction Rebellion protesters gathered in London to begin two weeks of action aimed at persuading the Government to stop new investment in fossil fuels.

There is growing pressure on the world’s largest financial institutions to show they are serious about going green, particularly with the UN’S COP26 climate change conference in

Glasgow approaching this November – the first time that the event will be hosted in the UK.

The Duke of Cambridge earlier this year urged bank bosses to “invest in nature” to help tackle climate change, a call that came days after it emerged that carbon dioxide in the atmosphere was on the cusp of surpassing preindustrial Revolution levels by more than 50pc.

The JP Morgan fund told investors yesterday that it had also exited its investment in electric carmaker Tesla in order to build a position in Facebook because it believes the latter has a “better risk/reward profile,” even though Tesla comes with greener bragging rights.

A JP Morgan spokesman declined to comment yesterday on whether any other companies could soon be dropped by the bank.