Signed by 193 countries in the French capital last December at COP 21, the Paris Agreement is now international law, having been ratified by at least 55 countries representing over 55% of global emissions. Following this success, all eyes now turn to Marrakech for COP 22 and the next phase in decision making.
If COP 21 signified commitment, COP 22 in Marrakech should motion action. Now is the time for Governments, businesses and individuals to start taking climate change seriously, recognise and react by law.
This year I hope we hear enough mention of the global finance sector.
As part of the new future of action on climate change, the global finance sector needs to sharply address the logic of short-term economic growth at the expense of our living environment and our longer term future.
Money is at work around the clock, being used to lend, invest, create, destroy, buy and change. Money is neutral, but how we use it as individuals and institutions gives it value. In short, it can be used for positive change, or destructive activity. As spenders, lenders, savers, investors, pension holders, fund managers, bank CEOs – we decide.
There is growing consensus that the financial services industry – and big business generally – need to play an integral role in fighting climate change.
COP 22 needs to indicate a change in practices, building on and filtering down from Government decisions – by reviewing what they do with their money, and what impact it has on the world around us beyond profits.
The global financial sector must now use the weight of its power and influence, moving from investment in unsustainable activities and into the environmentally positive alternatives we need to combat climate change. This shift includes providing opportunities for investors to access organisations that are making a positive impact through products such as Socially Responsible Investments (SRI), while also being transparent about where investors’ and savers’ money goes.
Our recent research shows that 60% of UK investors would like their money to support companies that are both profitable and ethical, with renewable and efficient energy being a primary target for their investments. However, 51% of respondents said they’d never been offered a Socially Responsible Investment (SRI).
Investors are showing a demand for these investment opportunities – they want financial products to reflect their desire to positively impact the world around them. In order to facilitate this, 53% of the respondents to our survey believe customers should be made aware of where their money is being invested. Passive investment no longer fulfils the desires they have for their money.
The sector can no longer ignore the fact that its stakeholders are interested in reversing climate change, and we as customers, shareholders and employees of banks need to make sure that those voices are heard.
If COP 22 is the year of action, let’s make it count.
By Huw Davies, Head of Retail Banking
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