In the world of finance, where fortunes can change with the click of a mouse, the story of Abrdn since its dis-emvoweled merger stands out—not for meteoric success, but for a series of missteps that have left the investment giant reeling. With Abrdn ranking as the fourth most exposed major asset manager to fossil fuel bonds, it’s time to delve into how this precarious position is exacerbating the firm’s financial woes.
The past few years have been anything but kind to Abrdn, with its stock plummeting over 70% from its 2015 peak and a staggering 29% drop in August last year alone. These figures are more than just alarming statistics; they’re a wake-up call to the inherent risks in the firm’s investment strategy, particularly its continued investment in the fossil fuel sector through bonds in corrupt coal companies like Adani and Glencore. Abrdn invests over $3.6 billion in bonds issued by coal, oil and gas expansionists. Its portfolio includes the 20 highest polluting companies that led to the emission of 4.8 million tonnes of carbon dioxide (CO2) in 2022, which highlights investment risks associated with environmental regulations and potential carbon pricing mechanisms.
The repercussions of Abrdn’s strategy are clear and present. Its shareholders are losing confidence and major investors such as Harris Associates have divested due to doubts about the firm’s direction.
Despite promises of revival, its CEO Stephen Bird has yet to change the firm’s declining fortunes, leading to widespread speculation about the firm’s future direction and leadership effectiveness. Bird is taking desperate actions without a longterm vision, such as slashing costs, cutting 500 jobs and reducing employee benefits. These are merely symptomatic treatments that fail to address the root cause: a flawed investment strategy, including its immense exposure volatile fossil fuel industry.
At the core of our message is a simple truth:
Abrdn’s significant exposure to toxic fossil fuel bonds is not just an ethical dilemma; it’s a financial hazard.
In an era where the tide is turning decisively against fossil fuels, Abrdn’s continued investment in coal, oil and gas expansion is a risky gamble that threatens its financial stability and future viability.
We extend a call to action to the employees of Abrdn. It’s time to voice your concerns and advocate for a shift away from fossil fuel expansionists and towards more sustainable, responsible investment strategies. The path to recovery for Abrdn lies not in doubling down on outdated industries but in embracing the future with investments that align with the global move towards sustainability.
The message is clear: Abrdn’s exposure to toxic bonds is a ticking time bomb that threatens to worsen its already precarious situation. For the sake of the firm’s future—and the planet—it’s time for a change in course: deny debt to companies expanding coal, oil and gas projects.
In October 2023, campaigners rebranded abrdn as ‘abrdoomed’, to expose the firm’s continued financing of coal expansion and call on the asset manager to deny debt to coal companies.