The business case for green energy

Subscribe to enjoy similar stories. It seems like yesterday that we, as advocates for a sustainable economy, had the wind in our sails. At the 2021 United Nations climate change conference in Glasgow, many of the world’s largest asset managers, banks and insurers pledged to decarbonize their investment portfolios, loans and insurance policies in line with the Paris Agreement.

The world today looks very different. Many of the Glasgow signatories are stepping back from their commitments. Others are playing down their climate action to avoid controversy.

Particularly in the U.S., the fossil-fuel industry, its allies and captive policymakers seek to punish companies and investors pursuing sustainability goals with frivolous lawsuits, smear campaigns and the withdrawal of state-controlled funds under management. These developments couldn’t come at a worse time. Last year was the hottest on record, and humanity suffered some of its costliest extreme weather events fueled by the warming planet.

Over the past decade, these events have cost the global economy more than $3.5 trillion, an increase of almost $800 billion over the previous decade. We can’t afford to ignore the climate crisis, the destruction of vital natural systems and increasing economic inequality. In the short term, the poor and powerless suffer the most significant consequences of a warming and deteriorating planet.

In the long run, we would all lose out, absent change. It shouldn’t be this way. When asset managers deploy capital across the world, they aren’t investing their own money.