Scientists should tell investors about climate, carbon and divestment

Scientists should tell investors about climate, carbon and divestment

If the Guardian’s aim with its Keep it in the Ground campaign is to draw attention to the issue of fossil fuel divestment, then they have already succeeded. The Paris financial community is turning out in force on Thursday to talk about the merits of selling shares in oil, coal and gas companies ahead of UN climate talks in December – versus the alternative of keeping the shares and engaging with directors. Companies are keen to be (and be seen to be) on top of this issue.

Investors are suspicious of activists and scientists telling them where to put their money. That is entirely understandable. Speaking as one who thought the world wide web was a bit of a nerdy fad of my particle physics colleagues in the 1990s, I’m certainly not in the business of giving anyone investment advice.

What the scientific community can do, and something we aren’t doing very well at the moment, is tell investors what is going on. This is point of the Oxford Martin Safe Carbon Investment Initiative which we are launching at the Assemblée Nationale on Thursday. If investors want to know whether their portfolios are contributing to dangerous climate change, they should be able to find out. And right now, they can’t. People don’t even know what to look for.

Sure, there are consultants out there who will tell you whether you (or your fund managers) hold any “pure coal” companies: but what exactly do you achieve by getting out of coal if you thereby boost the fracking industry when there is plenty of oil and gas out there to push us over 2C already? Or selling your coal interests to a state-owned corporation that probably has a lot less interest in ensuring they are exploited efficiently than you do?

More sophisticated consultants will measure your portfolio carbon footprint, or the amount of greenhouse gases generated by the companies you own last year. It’s a start, but it completely obscures the point that climate change is a stock problem: it is the total amount of carbon we dump in the atmosphere that matters, not the rate we dumped it last year. A company might boast about reducing its carbon footprint while at the same time opening up vast new oil and gas reserves in the Arctic, vastly increasing our committed future cumulative emissions.

Investment is supposed to be about the future, and so is the divestment campaign. Yet ironically, the whole debate is stuck in the present. People are bickering about what companies are doing now and ignoring the plans they are quietly putting in place for future emissions.

if we are serious about holding global temperatures to 2C, we need a plan to get net carbon dioxide emissions to zero by the time human-induced warming reaches 2C. It’s about 0.92C now and rising at about two-hundredths of a degree per year.

Schermata 2015-07-10 alle 15.37.21

Source: The Guardian

Date: July 2015

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