Comprehensive Disclosure, Green Risk Management: Can Yield Mainstream Sustainable Investment

Dear Fellow Earthlings,

Mark Carney is the most recent “friend of Earth” that I have come to know about. A renowned economist, Mark has impeccable credentials: Governor of the Bank of Canada (2008 - 2013), Governor of the Bank of England (2013 - 2020), and currently an investment banker focusing on investment strategies that can turn Earth’s economy from brown to multiple shades of green. In addition to his work as a banker, Mark is a UN special envoy for climate and finance.

A few months ago, on National Public Radio here in Oregon, I heard a rebroadcast of a speech Mark gave on “Climate Risk and Resilience”, delivered on September 24, 2019. After hearing that speech, I became aware that Mark is more than a friend of Earth. Mark Carney has concrete ideas as to how governments, financial institutions, and investors from the entire world hold various keys to dealing with global warming and the “existential threat” it constitutes.

Mark listed and described 3 points which we need to consider as we try to replace the brown global financial system with one composed of multiple shades of green:

1. Climate disclosure must become comprehensive.

2. Climate risk management must be transformed.

3. Sustainable investing must go mainstream.

Regarding DISCLOSURE: Through a special task force on climate-related financial disclosures (the TCFD), that is now in operation, ever increasing amounts of reliable information are being passed on from corporations to “the world's top banks, asset managers, pension funds, insurers, credit rating agencies, accounting firms, and shareholder advisory services”. This exchange of information will foster quicker assessment of risks we must deal with as we guide the whole world to a new economy. It is time for every country to get involved -- because the world won't get to net zero if the financial sector doesn't know how companies are responding.

As for RISK MANAGEMENT: In the face of the ultimate risk — the threat to the very existence of human life — the scope of risks needing assessment must be expanded. Otherwise, the providers of capital (“banks, insurers, asset managers, and those who supervise them”) will be hard put to deal with climate related risks.

SUSTAINABLE INVESTING must become almost completely synonymous with investing. Extra income has to go right back into Earth so that all humans — and indeed all life forms — will benefit. Only through sustainable investment can we transform our energy sources, design individual specific proteins, and gain the capability to break plastics down to their constituent elements — just to name a few accomplishments we must achieve if we hope to see a 22nd century.

For the next 3 days (installments 524 - 526), I will add comments of my own regarding some of the contents I have analyzed in trying to digest Mark Carney’s words.

Steve Walker

Earthsaver and Jingles Creator

© 2013 Steve Walker, The Jingles-The Japan Foundation for English Pronunciation, Summit Enterprises.