French oil giant TotalEnergies (TTE) has delivered a consistent green strategy and not cut its dividend, unlike the two UK oil majors BP (BP) and Shell (SHEL), says Dunedin Income Growth (DIG ) co-manager Ben Ritchie, explaining why it, and not they, is the investment trust’s third biggest holding at 6% of assets.

This is the fourth and last excerpt from our recent virtual event with the UK equity income investment trust which invests 20% in European companies.

You can watch the previous videos:

• ‘UK is all about dividends, but beware high yielders’;
• ‘Dunedin: The big FTSE dividend stocks aren’t as safe as you think’;
• ‘Dividend diversifiers: Two income stocks you won’t find in many funds’.

Alternatively, you can catch up with the whole one-hour programme with our ‘Big Broadcast’.

Can’t watch now? Read the transcript

Ben Ritchie:

We have a pragmatic approach to thinking about sustainability. We have some criteria which Rebecca talked about earlier. We can’t invest in companies that have got shale. We can’t invest in companies that have got really polluting areas. We need companies to have more than 50% of their revenues coming from gas, electricity, and renewables in the upstream and Total has that. I think importantly, Total is a company which has had a consistent approach to how it’s managing its business over the last decade.

Certainly, since Patrick Pouyanné came in to be the CEO when the previous CEO died. I think it was back in 2012. The strategy of balancing oil, gas, renewables, what they’re doing in downstream. What they’re doing in terms of green energy has been very consistent. Any of our viewers in terms of following what BP has done, seems to change every couple of weeks. What Shell’s doing, maybe that changes every six months. What Total’s been doing has been very consistent and it’s that focus on growing energy, but also, growing that renewable and electricity part of the business. They’ve done a really, really good job on that.

Important, go back to 2020, Total didn’t cut its dividend. Both of the UK majors did and I think it’s that combination, very efficiently run company. Good long-term strategic view and consistently looking to return cash to shareholders in a sensible way that we really like.