Post-Paris Planning: Low-Carbon Economy is Essential

by Duane Nichols on December 12, 2015

Bright Future with Planning & Cooperation

Re-Tooling Economy for Low-Carbon Future is Critical Post-Paris Step

From an Article by Mindy Lubber, Ceres News, December 10, 2015

The ongoing international climate negotiations here in Paris are an intricate ecosystem of policy wonks, finance ministers and world leaders trying to create one seamless tapestry called a low-carbon future.

But there’s another equally important ecosystem in play in Paris—the capital market ecosystem which must stitch its own tapestry for managing escalating global financial climate risks. More than I ever expected, this topic has been getting enormous attention—not just at Ceres-hosted events—but beyond. From stranded carbon assets and 2-degree stress testing to nominating climate-competent board directors and eliminating fossil fuel subsides, businesses and investors are all talking in lock-step about a top-to-bottom transformation in how our economic system factors climate risks and opportunities into daily decision-making.

I’ll be the first to admit, this transformation will not come easily or quickly. After all, we’re looking to shift an economy that has been driven by fossil fuels for more than a century. But a strong binding climate agreement—one that sends a clear market signal that the world is ready for a low-carbon future—will certainly hasten the process.

So what will it take to re-tool our economy for a de-carbonized world, a world that must reduce greenhouse gas pollution by 80 percent by 2050 to prevent catastrophic global temperature increases?

One key theme I heard often—New York Times columnist Thomas Friedman called it “the word of the day at COP21”—is stranded carbon risks.

Remarkably this concept didn’t exist a few years ago. But as economists and researchers began connecting the dots on the necessity of keeping fossil fuel resources such as oil and coal in the ground—rather than extracting and burning them—the potential of carbon assets being “stranded” began taking hold. The issue is especially germane for energy companies whose business models have long been premised on producing more and more fossil fuels well into the future, even while demand scenarios shift.

But with scientists and investors asking hard questions about how much carbon pollution the planet can handle, stranded assets has taken center stage. Last week, Carbon Tracker projected potential losses of up to $2.2 trillion for oil and gas firms who are overestimating future oil demand.

“It’s like the old Road Runner TV show where the coyote keeps jumping off the cliff—but his legs keep running and running,” Carbon Tracker’s CEO Anthony Hobley said, of the oil sectors’ overly bullish demand projections.

Another trend gaining traction in Paris is 2-degree stress testing. These tests would examine how companies’ long-term business strategies—especially energy companies—will hold up if negotiators are successful this week in achieving an accord that will limit global temperature rise to 2 degrees Celsius. Even if they don’t, political and business momentum for a low-carbon transition is unprecedented—and will only grow stronger.

Many European energy companies are doing these tests and it’s a big reason why some, including Total, are already shifting more capital towards cleaner natural gas and renewables and away from carbon-intensive coal.

But momentum is building to broaden this effort. “We should get all companies to do this,” said Sharan Burrow, general secretary of the International Trade Union Confederation.

Major public pension funds and other investors are also being pressed to do portfolio-wide stress tests.

Dozens of other ideas were highlighted for building a truly low-carbon economy—among the biggest, ending fossil fuel subsidies. Morocco, which has set a goal to get half of its power from green energy by 2030, has already taken this bold step. “It required political courage, but it sent a strong message,” Morocco’s energy minister said on Saturday.

U.S. pension funds are also advocating for changing the composition of corporate boards, especially at energy companies. Dozens of shareholder resolutions were filed with energy companies last year requesting that they diversify their boards.

“We need climate competent boards,” said Jack Ehnes, CEO of the California Teachers’ Retirement System, which manages nearly $200 billion in assets.

Ehnes also highlighted the important work of the Sustainability Accountability Standards Board, a nonprofit group pushing to strengthen and standardize corporate reporting on climate risks and other sustainability challenges.

As I return home from Paris, regardless of the final outcome, one thing is clear: the time has come to re-tool our global economy for a low-carbon future. Many businesses and investors are ready, but we’ll need to accelerate and broaden the effort—and do so quickly.

Why Climate Leadership Means Keeping Fossil Fuels in the Ground

John Kerry Pledges New Support to Vulnerable Countries at COP21

Roadmap for Climate Action Unleashes Cities Potential to Cut Global Carbon Emissions

See also: www.FrackCheckWV.net

{ 2 comments… read them below or add one }

Spot on Ceres December 13, 2015 at 12:17 am

CERES …. » » Who We Are < <<

Ceres is an advocate for sustainability leadership. Ceres mobilizes a powerful network of investors, companies and public interest groups to accelerate and expand the adoption of sustainable business practices and solutions to build a healthy global economy.

Our mission is to mobilize investor and business leadership to build a thriving, sustainable global economy.

Founded by a small group of investors in 1989 in response to the Exxon Valdez oil spill, Ceres has been working for more than 20 years to weave sustainable strategies and practices into the fabric and decision-making of companies, investors and other key economic players. Learn more about our history…

Our Coalition and Networks
Ceres is uniquely positioned at the nexus of the business, investment and advocacy communities. To advance our mission and vision, we leverage the power of our partners—leading investors, Fortune 500 companies, thought leaders and policymakers—to positively influence change. To accomplish our mission, Ceres relies on the power and expertise of the companies we engage with, the investors we bring together and the public interest groups we work with.

CERES COALITION
Ceres works with more than 130 member organizations that make up the Ceres Coalition to engage with corporations and help advance our goal of building a sustainable global economy. These members include environmental and social nonprofit groups such as NRDC, Union of Concerned Scientists and Oxfam, institutional investors such as the California and New York public pension funds, socially responsible investors (SRIs), labor unions and other key stakeholders. In recent years, Ceres has expanded the coalition’s expertise to include more social issues such as diversity and human rights. Learn more about the Ceres Coalition…

COMPANY NETWORK
Two people shaking hands.We work with nearly 70 companies–across more than 20 sectors–committed to engaging with diverse stakeholders, improving their performance on social and environmental issues and disclosing strategies and progress publicly. More than half of our network companies are listed on the S&P 500, from the apparel, auto, electric power, financial services, oil & gas, technology and other sectors. Learn more about our company network…

INVESTOR NETWORK
Paper showing investors and graph. Ceres works with investors worldwide to improve corporate strategies and public policies on climate change and other environmental and social challenges across the global economy. Our investor partners include state treasurers, institutional investors, labor groups and socially responsible investment (SRI) funds. In 2003, Ceres launched the Investor Network on Climate Risk (INCR), a network that now includes 100 leading investors collectively managing more than $11 trillion in assets. Learn more about our work with investors…

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Mindy Lubber December 13, 2015 at 12:25 am

Mindy S. Lubber JD, MBA is President of CERES

Mindy S. Lubber is the president of Ceres and a founding board member of the organization. Mindy regularly speaks about corporate and investor sustainability issues to high-level leaders at the New York Stock Exchange, United Nations, World Economic Forum, Clinton Global Initiative, American Accounting Association, American Bar Association and more than 100 Fortune 500 firms.

She also directs Ceres’ Investor Network on Climate Risk (INCR). INCR is a group of 110 institutional investors managing about $13 trillion in assets focused on the business risks and opportunities of climate change. She has led negotiating teams of investors, NGOs and Fortune 500 company CEOs who have taken far-reaching positions on corporate practices to minimize carbon emissions, water use and other environmental impacts. She has briefed powerful corporate boards, from Nike to American Electric Power, on how climate change affects shareholder value.

Under Mindy’s leadership, Ceres launched The 21st Century Corporation: The Ceres Roadmap for Sustainability and The 21st Century Investor: Ceres Blueprint for Sustainable Investing, visionary guides highlighting environmental and social performance improvements companies and investors must achieve to succeed in the resource-constrained 21st century global economy. She also helps coordinate Ceres’ Business for Innovative Climate & Energy Policy (BICEP), a coalition of more than 20 leading consumer brand companies advocating for strong climate and clean energy policies in the U.S. and abroad.

Mindy regularly speaks about corporate and investor sustainability issues to high-level leaders at the New York Stock Exchange, United Nations, World Economic Forum, Clinton Global Initiative, American Accounting Association, American Bar Association and more than 100 Fortune 500 firms. She has led negotiating teams of investors, NGOs and Fortune 500 company CEOs who have taken far-reaching positions on corporate practices to minimize carbon emissions, water use and other environmental impacts. She has briefed powerful corporate boards, from Nike to American Electric Power, on how climate change affects shareholder value. She is also a sustainability thought leader and regularly blogs for Huffington Post and Forbes.

In 2010, Mindy was honored by the United Nations and the Foundation for Social Change as one of the “World’s Top Leaders of Change” for her work in mobilizing leading companies to integrate environmental challenges into core business strategies. She is a recipient of the Skoll Award for Social Entrepreneurship and was named one of “The 100 Most Influential People in Corporate Governance” by Directorship magazine.

Prior to Ceres, Mindy held various leadership positions in government, financial services and the not-for-profit sector. Mindy joined the U.S. Environmental Protection Agency (EPA) in 1995 as a senior policy advisor and was named regional administrator under President Bill Clinton in 2000. As regional administrator, she was responsible for the administration and management of the EPA’s New England Regional Office and its then $450 million annual budget. Additional key priorities in her role included organizing aggressive cleanups of hazardous waste sites with a goal of redevelopment, new jobs and urban revitalization as well as ensuring the long-term protection of drinking water supplies.

Mindy was the founder, president and CEO of Green Century Capital Management, a family of environmentally responsible mutual funds. She also served as president of the National Environmental Law Center.

Mindy holds a master’s in Business Administration from SUNY Buffalo and earned her law degree from Suffolk University. She resides in Brookline, Mass., with her husband and two children.

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