Sustainability Community

Dear All,

Together with Francesco, we have prepared the attached article with some current considerations linking sustainability and geopolitcal considerations.

Hope you will enjoy the read and let us know if you will have any comments !

Attachment(s)

IS CLIMATE CHANGE LOSING POLITICAL SUPPORT.pdf   188 KB 1 version

Thank you Jacopo, I found this article very timely and interesting.

What are other members' thoughts?

Saw this today. Adair Turner still thinks there is a chance of limiting global warming well below 2 C Degrees. Positive view for a change.

Full FT article here.

A couple of quotes here:

"Over the next six years, we in the UK are going to see an important test of whether it's possible, because we have a government that is committed to getting to zero grammes of carbon per kWh of electricity. Let's assume that their true target is "near zero", so just 20 grammes of carbon per kWh of electricity, and the date is 2030. I think they will get pretty close."

"My judgment is that if you asked whether we will get to something close to a zero-carbon economy by 2060 or 2070, I think it is inevitable that we will, because we have discovered and developed a set of technologies that are fundamentally superior to the existing fossil-fuel system. And when we get there, we will have an economy that is better for human welfare, including for climate change. Moreover, the impact of having got there on standards of living in 2070 will be so trivial that we won't notice them. They may even be positive in terms of conventionally measured GDP."

"Where is the money going to come from? In the rich world, most of it can come from the private sector, provided other aspects of the economy are appropriately designed - for instance, provided one has appropriate structures for contracting with offshore wind developers and we have carbon prices applied to such processes as steel production. I do not, however, exclude a role for public-private partnerships, or publicly supported funding, even in rich, developed countries. But in the rich countries, you probably could get there even without such ideas, provided you have carbon taxes and what are called "contracts for differences", to ensure predictable prices for wind-generated electricity. The further you go from upper-middle to low-income countries, the greater the amounts of money that will have to come from outside, especially from the global development banks, simply because these countries are exposed to risks - political risks, exchange rate risks, credit risks - that will make the cost of private capital too high to keep renewable energy financially feasible."

What do you think?

Good morning Community,

I hope you had a chance to read Jacopo's and Francesco's article on declining government support. Please share your views here.

Today i saw this article and thought i'd share. From "Independent", Ireland. Grandfather, student and toddler to take government to court over climate inaction.

Brief summary:

A legal case has been approved in Ireland, allowing a grandfather, a student, a toddler, and a legal charity to challenge the government's climate action efforts. They argue that the government's actions are insufficient and fail to meet commitments under the Climate and Low Carbon Development Act. The plaintiffs include retired psychotherapist Philip Kearney, climate activist Saoi O'Connor, and a 20-month-old child represented by their mother. They claim their constitutional rights, as well as rights under the European Convention on Human Rights and the EU Charter of Fundamental Rights, are infringed due to inadequate climate protection.

The Centre for Environmental Justice at Community Law and Mediation (CLM) is supporting the case, highlighting deficiencies in the 2024 Climate Action Plan. CLM argues that the plan fails to achieve necessary greenhouse gas reductions to meet Ireland's 2025 and 2030 carbon budgets. The case draws inspiration from recent legal actions by senior citizens in Switzerland and young people in Portugal at the European Court of Human Rights.

This case will run alongside another challenge by Friends of the Irish Environment and CLM against the 2023 Climate Action Plan, with a hearing scheduled for January.

https://pitchbook.com/news/reports/2024-sustainable-investment-survey

PitchBook has released their fifth annual sustainabile investment survey featuring insights into opinions and trends in alternative asset classes. It discusses many of the topics and concerns highlighted in Francesco and Jacopo's article, above. The report conclusions include:

• 39% of the survey respondents who said they do not incorporate ESG factors into their investment decision-making process have in fact declined to make an investment due to ESG concerns. Thus, even respondents' perceptions about themselves don't align with reality. When people think ESG is just about values or some green hurdle, they ignore the aspects of the framework that assist in richer diligence practices. 
  

• PitchBook spoke to fund managers who do not want to be labeled as Impact funds because they are concerned that potential investors think that means they are being asked to accept subpar results and jump to a quick "no." Their survey shows that 56% of respondents who make impact investments prioritize market-rate returns as the primary objective when evaluating investment opportunities. While concessionary return strategies do exist, when evaluating impact funds, the assumption should not be that every such fund is concessionary. 

• When it comes to ESG, they asked asset managers (GPs) and allocators (LPs) if they were increasing or decreasing their focus on sustainable investment and also how they thought the other group was acting. It was clear that most who are already practitioners of ESG or impact investing are sticking with their approach, and some are even increasing focus. But for many, the perception on each side, no doubt fed by news coverage, is that the other was decreasing. Fortunately things are not as they appear.

Disclosure: I am not associated with PitchBook in any way, nor do I receive any financial incentive from them. The report is free to download but does require you to share your name and contact details. Wording above is partially paraphrased from a PitchBook email.

great survey, thank you Hamish.

Here's a video from FT "Is climate change risk underpriced?"

The world is reeling from record-breaking heatwaves, wildfires, rainfall and devastating floods. As well as the human toll, these can also be measured in the economic value destroyed. In a world that is rapidly becoming more vulnerable to extreme weather events, outdated assumptions about asset values need recalibrating

How do you assess climate change risk in your portfolios and what actions do you think investors can make to reverse the trend of declining government support?

Original Message:
Sent: 30-09-2024 17:21
From: Hamish Wilson
Subject: Is Climate Change Losing Political Support?

https://pitchbook.com/news/reports/2024-sustainable-investment-survey

PitchBook has released their fifth annual sustainabile investment survey featuring insights into opinions and trends in alternative asset classes. It discusses many of the topics and concerns highlighted in Francesco and Jacopo's article, above. The report conclusions include:

• 39% of the survey respondents who said they do not incorporate ESG factors into their investment decision-making process have in fact declined to make an investment due to ESG concerns. Thus, even respondents' perceptions about themselves don't align with reality. When people think ESG is just about values or some green hurdle, they ignore the aspects of the framework that assist in richer diligence practices. 
  

• PitchBook spoke to fund managers who do not want to be labeled as Impact funds because they are concerned that potential investors think that means they are being asked to accept subpar results and jump to a quick "no." Their survey shows that 56% of respondents who make impact investments prioritize market-rate returns as the primary objective when evaluating investment opportunities. While concessionary return strategies do exist, when evaluating impact funds, the assumption should not be that every such fund is concessionary. 

• When it comes to ESG, they asked asset managers (GPs) and allocators (LPs) if they were increasing or decreasing their focus on sustainable investment and also how they thought the other group was acting. It was clear that most who are already practitioners of ESG or impact investing are sticking with their approach, and some are even increasing focus. But for many, the perception on each side, no doubt fed by news coverage, is that the other was decreasing. Fortunately things are not as they appear.

Disclosure: I am not associated with PitchBook in any way, nor do I receive any financial incentive from them. The report is free to download but does require you to share your name and contact details. Wording above is partially paraphrased from a PitchBook email.

------------------------------
Hamish Wilson
Partner

Original Message:
Sent: 11-09-2024 09:38
From: Aya Pariy
Subject: Is Climate Change Losing Political Support?

Good morning Community,

I hope you had a chance to read Jacopo's and Francesco's article on declining government support. Please share your views here.

Today i saw this article and thought i'd share. From "Independent", Ireland. Grandfather, student and toddler to take government to court over climate inaction.

Brief summary:

A legal case has been approved in Ireland, allowing a grandfather, a student, a toddler, and a legal charity to challenge the government's climate action efforts. They argue that the government's actions are insufficient and fail to meet commitments under the Climate and Low Carbon Development Act. The plaintiffs include retired psychotherapist Philip Kearney, climate activist Saoi O'Connor, and a 20-month-old child represented by their mother. They claim their constitutional rights, as well as rights under the European Convention on Human Rights and the EU Charter of Fundamental Rights, are infringed due to inadequate climate protection.

The Centre for Environmental Justice at Community Law and Mediation (CLM) is supporting the case, highlighting deficiencies in the 2024 Climate Action Plan. CLM argues that the plan fails to achieve necessary greenhouse gas reductions to meet Ireland's 2025 and 2030 carbon budgets. The case draws inspiration from recent legal actions by senior citizens in Switzerland and young people in Portugal at the European Court of Human Rights.

This case will run alongside another challenge by Friends of the Irish Environment and CLM against the 2023 Climate Action Plan, with a hearing scheduled for January.

------------------------------
Aya Pariy

Original Message:
Sent: 08-07-2024 09:39
From: Jacopo Gadani
Subject: Is Climate Change Losing Political Support?

Dear All,

Together with Francesco, we have prepared the attached article with some current considerations linking sustainability and geopolitcal considerations.

Hope you will enjoy the read and let us know if you will have any comments !

------------------------------
Jacopo Gadani
Vice President ESG Solutions
------------------------------