At Sustainable Investment Forum North America 2021, AQR Principal and Head of Responsible Investment Christopher Palazzolo spoke about how shorting can help investors better effect change at high-emissions companies. Chris was joined on this panel by Rick Slocum, Chief Investment Officer of Harvard Management Company, and moderator Margaret Ann-Splawn, Executive Director of the Climate Markets & Investment Association.
In their discussion, Chris explains that short selling within a low-carbon portfolio enables investors to more fully express their ESG views, increases their ability to effect change at high emitting firms, and allows for better climate-related risk management. Additionally, Chris argues that it’s crucial that the carbon exposure of short positions offsets the carbon exposure of long positions when calculating a portfolio’s carbon footprint.
Watch the 20-minute replay of the panel below.
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