BNP Paribas Asset Management is set to exclude coal from less than 25% or €100 billion ($114 billion) worth of its investments, effective at the start of 2020, a spokesman said.
The new policy will apply to the money manger's actively managed open-end funds, excluding exchange-traded funds and index funds, and will be a default policy for segregated mandates, the spokesman confirmed.
BNP Paribas AM will exclude companies that derive more than 10% of their revenue from mining thermal coal and/or account for 1% or more of total global production in support of aligning its portfolios with temperature rises well below 2 degrees Celsius by 2025, which was agreed to in the Paris Agreement in 2015.
"From an investment perspective the outlook for the coal industry looks increasingly uncertain as less carbon-intensive fuel sources, in particular renewables, become ever more competitive," said Mark Lewis, global head of sustainability research, in a news release.
Mr. Lewis said: "The main renewable technologies already compete favorably with fossil-fuel power generation, and in the best locations for wind and solar globally, new build costs are actually below those of existing fossil-fuel plants."
BNP Paribas AM has €399 billion in assets under management.