Month: September 2019

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UN Climate Summit: Asset owners commit to carbon neutral portfolios by 2050 (IPE)

https://www.ipe.com/news/esg/un-climate-summit-asset-owners-commit-to-carbon-neutral-portfolios-by-2050/10033434.article

Nordic pension investors have committed to carbon neutral portfolios by 2050 as part of a new asset owner campaign.

Members of the alliance will set and publicly report on intermediate targets “in line with Article 4.9 of the Paris Agreement”, thereby holding themselves publicly accountable, according to a statement about the new initiative.

A spokeswoman said this meant the investors would be setting targets for the same points in time as countries will under the accord.

“The idea is that investors and countries can influence each other towards higher levels of ambition as they set such targets, especially when they set them in synchronicity, and when they proceed in lock-step,” she added.

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What’s Behind the World’s Biggest Climate Victory? Capitalism (Bloomberg)

https://www.bloomberg.com/graphics/2019-can-renewable-energy-power-the-world/

The chief executive of the world’s largest private coal company sat before a group of U.S. lawmakers who wanted to know whether the fuel had a future. He didn’t hesitate. “Coal,” he said, “is the future.”

Not quite. This April, for the first time ever, renewable energy supplied more power to America’s grid than coal—the clearest sign yet that solar and wind can now go head-to-head with fossil fuels. In two-thirds of the world, they’ve become the cheapest forms of power.

Solar and wind will power half the globe by 2050, based on BloombergNEF forecasts. By that time, coal and nuclear will have all but disappeared in the U.S., forced out by cheaper renewables and natural gas.

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JPMorgan Says Shipping Loans Will Go Only to Clean Vessels (WSJ)

https://www.wsj.com/articles/j-p-morgan-says-shipping-loans-will-go-only-to-clean-vessels-11568139086

J.P. Morgan Asset Management is joining a chorus of global financiers saying that protecting the environment will be a key consideration for extending shipping loans.

“There is not an institutional investor today in the Western world that is not thinking about the impact of environmental, social and governance factors,” Andy Dacy, the chief executive of the finance firm’s global transportation group, told a meeting at the International Shipping Week here.

“Anyone looking for [shipping] capital, if you’re not employing such a strategy, it’s going to be increasingly very difficult to get capital.” Mr. Dacy said. 

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ESG Investing: Can You Have Your Cake and Eat It, Too? (CFA Enterprising)

https://blogs.cfainstitute.org/investor/2019/09/03/esg-investing-can-you-have-your-cake-and-eat-it-too/

The ongoing debate about environmental, social, and governance (ESG) investing sometimes feels like a rehash of that age-old rhetorical question.

Proponents of ESG data believe it can help investors better understand the risks and opportunities companies face and may even offer alpha generation potential. On the other hand, skeptics think ESG criteria limit the universe of available stocks and that such restrictions are bound to negatively impact returns.

To return to our metaphor, having the ESG cake means generating strong investment performance, while eating it too implies doing good from an ESG perspective.

So which is it? Can investors have it all?

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Here’s a question you should ask about every climate change plan (Bill Gates)

https://www.gatesnotes.com/Energy/A-question-to-ask-about-every-climate-plan

I get to learn about lots of different plans for dealing with climate change. It’s part of my job—climate change is the focus of my work with the investment fund Breakthrough Energy Ventures—but it’s just as likely to come up over dinner with friends or at a backyard barbecue. (In Seattle, we get outside as often as we can during the summer, since we know how often it’ll be raining once fall comes.)

Whenever I hear an idea for what we can do to keep global warming in check—whether it’s over a conference table or a cheeseburger—I always ask this question: “What’s your plan for steel?”

I know it sounds like an odd thing to say, but it opens the door to an important subject that deserves a lot more attention in any conversation about climate change. Making steel and other materials—such as cement, plastic, glass, aluminum, and paper—is the third biggest contributor of greenhouse gases, behind agriculture and making electricity. It’s responsible for a fifth of all emissions. And these emissions will be some of the hardest to get rid of: these materials are everywhere in our lives, and we don’t yet have any proven breakthroughs that will give us affordable zero-carbon versions of them. If we’re going to get to zero carbon emissions overall, we have a lot of inventing to do.