With Greta Thunberg on a sailing trip to protest climate change, are banks taking the threat seriously?
Nick Jacobs, chief executive at real estate investment company Rowan, says YES.
Climate change makes investment change an imperative, and the wider investment and finance community needs to take this to heart. Thankfully, the signs are that finance is starting to take this issue seriously beyond having it as a fashionable panel debate topic.
Central bankers, including Bank of England governor Mark Carney, have made heartening comments about how climate change is a threat to not just our planet but financial stability, proposing the incorporation of climate risks into their macro-economic modelling.
In private finance, capital is being pulled out of carbon-intensive assets due to the very real risk that they become stranded as climate change begins to bite, with a growing number of investors refusing to partner with firms that still invest in sinful assets like coal.
Of course, more can always be done. All of us in finance need to make sure that our actions take us towards making triple net investing – judged on planetary, social and financial impact – the standard. We must keep moving in this direction – time is running out.
Lisa Ashford, managing director for Energise Africa and chief executive of Ethex, says NO.
Are the banks and wider financial services doing enough to combat climate change? Our experience is no.
There is widespread “green-washing” as companies suggest that they are getting their act together by divesting some of their assets from coal, but many of these claims can be entirely misleading.
In recent years, we’ve seen a number of firms flaunt their ethical and sustainable credentials in their latest products. But dig a little deeper and there is often scant positive impact on climate or sustainability.
We have seen “ethical” funds that declare they will not invest in any company that gets more than 30 per cent of its profits from fossil fuels. But 30 per cent is still a lot.
The Bank of England warned in April that climate change could wipe of $20 trillion worth of global assets. If we are to successfully address climate change and ensure that we can achieve the UN Sustainable Development Goals, we must look beyond the bottom line and encourage everyone to take control of their money and enable them to do so.
Main image credit: Getty