Wellcome’s work is funded by the returns generated from our investment portfolio.
Part of our investment portfolio is held in public equities. For a long time, our public equities approach was to hold shares in a broad range of companies, representative of the global economy. More recently, we have taken a decision to concentrate our holdings more in companies that are in non-cyclical industries. This shift has resulted in us selling our holdings in several commodities-based businesses.
As part of that shift, earlier this year we sold our holdings in BP and Shell. These sales were not a reflection of the companies’ approach to the energy transition. BP and Shell have both set net zero targets – a move that as an investor we encouraged and supported them to take.
We take stewardship of the companies we hold shares in seriously. We regularly review companies’ approach to environmental, social and governance issues, and engage with them where we have concerns. Responsible businesses that respond positively to the world around them are better long-term investments, ensuring we can continue to fund our mission of supporting science to solve urgent health challenges. You can read more about our approach to responsible investment and stewardship.
We have a strategy to drive down carbon emissions from companies in our portfolio and to ensure the portfolio becomes net zero by 2050 at the latest. We routinely have conversations about decarbonisation with companies we invest in, with many of them responding positively. We report on our investment portfolio’s progress towards net zero annually.
Since we are interested in bringing about real-world change, our preference is to engage with companies to encourage and support them to decarbonise. However, as a last resort, we have previously sold positions where companies were not willing to take appropriate action on this issue. This was not the case with our sales of BP and Shell.
More broadly, Wellcome takes its own carbon emission responsibilities seriously. We are working to bring down our own emissions and examining what further action we can take on other emissions associated with our work. Some of our greatest emissions are linked to the research work we fund. We encourage researchers we fund to choose lower carbon travel methods and will pay for these whether or not they are the cheapest method. Life sciences are a substantial emitter of greenhouse gases and we have begun to explore ways we might be able to help address this issue, initiating a project examining how Wellcome can support researchers who wish to assess and mitigate the carbon footprint of their work.