The necessity: Tackling carbon.
One year ago, we published
Investing in Climate Change: An Asset Management Perspective.
We argued that the growing investment opportunities in climate change were driven by long-termmega-trends that would continue into the oreseeable uture.One year on, the absolute necessity to act now to mitigate and adapt to climate change is even moreurgent, and the opportunities generated by the sector continue to increase. New evidence hasestablished that carbon in the atmosphere has reached an 800,000 year high (see graph below).The leading scientic research shows that we are careening towards the tipping point where averageglobal temperatures are likely to rise by 2°C or more. Beyond 450 ppm CO
e, it is increasingly likely thata series o macro-climatic shits will set up a sel-sustaining cycle o rapid global warming. Withoutsignicant and immediate action, or some unoreseen miracle, this tipping point stands no more than15 to 20 years away.The research in this report is driven by these two imperatives o necessity and opportunity. We havea new challenge, however, added to the mix: how to nd the nancing to develop and deploy thetechnologies we need to mitigate and adapt to climate change. Trillions o dollars have already beenwiped o the global balance sheet by alling asset values, and the world’s major economies areheading into recession. Investors understandably lack condence at the moment and governments,who are dealing with the contingencies o the banking challenge, will be reluctant to commiturther capital to the climate change sector or the oreseeable uture.
Investing in Climate Change, One Year On
Member o the Group Executive CommitteeGlobal Head o Asset Management
A t m o s p h e r i c C O
c o n c e n t r a t i o n , p p m
Years before present
700,000 600,000 500,000 400,000 300,000 200,000 100,000 0
Concentration in 2008: 385 ppm
i Investing in Climate Change 2009
Today’s atmospheric CO
concentrations are higher than they have been or at least 800,000 years
Source: D. Lüthi,“High-resolution carbon dioxide concentration record 650,000-800,000 years beore present,” Nature, 15 May 2008.
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