Net Zero: Why Carbon Neutral Pledge Keys Are Honesty

You’ve probably heard the phrase “net zero” before. It means carbon neutral, but it’s much more catchy. It is impossible to achieve without truly reducing emissions, but some carbon emissions are still acceptable. Emissions remaining after reduction efforts need to be offset, for example, by planting trees. That way, there is no net impact on the climate.

Report by the Energy and Climate Intelligence Unit (ECIU), Acquisition of shares: Global evaluation of net zero target One-fifth of the world’s largest listed companies have set net-zero goals, saying, “The majority of these companies also have provisional goals, published plans, and reporting mechanisms, with just over a quarter. Meets the complete set of “robustness standards”. “.

Goals and pledges should be backed up – you can’t just come out and say you have a net zero goal for 2050.

ECIU said: “A robust net-zero plan with provisional goals, appropriate policies and governance mechanisms is essential not only to reduce emissions, but also to ensure sustainable employment through clear signals sent to businesses and investors. It can also create prosperity. “

Net Zero has been a powerful and quick move so far It stirs my imagination. We set goals and frameworks and facilitated discussions.

However, on Earth Day two weeks ago, Senior scientists rounded Net Zero’s goal as a “dangerous trap”..

“We, The Net Zero idea has recklessly approved a reckless “burn now, pay later” approach, and carbon emissions continue to skyrocket. “ In that case, it’s not a panacea, but a license to postpone action.

Especially in the financial services sector, many major pension providers and banks make net-zero commitments. Barclays, HSBC, Aviva, Axa, Legal & General are just a few of the common names.

Net zero in financial services is especially important because the funds lent and invested by these large institutions fund all other activities in the global economy. Praise is for these commitments-they may not have prioritized this task just as easily. But it’s also worth keeping some irony.

First, the pledges are rolling down and I wonder if it’s a little too easy to make them right away. Is the goal post too wide now? Do I need to set the bar to net zero by 2030? The pension fund’s investment committee shouts no, while the planet itself probably agrees.

Second, it’s very difficult to determine motivation, but all CEOs stare at the abyss, The state of the world inherited by their children (I want to fix that, but I hope more older people will come out and be loud and proud of their true environmental problems).

Ironically, I tend to believe that motivation is now driven by fear of being unattractive. There is a strong sense that if a company does not make a pledge, the company will be considered a Pye-dog, and it may be this fear of others’ judgment, the pressure from good old-fashioned peers, that drives the first pledge. Hmm. If so, the effort is likely to collapse and scientists suspecting Net Zero prove correct.

The ECIU report also emphasizes that there are some variability in the credibility of Net Zero’s pledge, and that competition for zero must be competition for “honesty as well as intent.” Without integrity behind the pledge, the pledge will not work.

Honesty and credibility may be the Holy GrailHowever, neither naturally comes to company executives, whose earnings this year are the key indicators they judge. Much of the internal debate about climate change pledges and ESG (environmental, social, governance) standards and scope of integration is about “how this shows that it boosts profits.” Or “How can we show that this climate change pledge limits economic risk?”

For decades, fiduciary duty has focused on managing risk to financial outcomes. CEOs now do not lose jobs or bonuses without meeting their interim climate goals. They may not make money, or they may lose money as a result of not managing risk.

They also don’t have much time to show a deep interest in things in a busy day, so long-term by reducing economic losses by reducing climate risk, or by taking climate action. Only in this context of boosting growth, these issues can go beyond their desks.

But integrity, if not action, basically relies on removing climate change concerns from the areas of profit and loss.

It is understood that lack of integrity and lack of genuine communication carry the risk of reputation, which can affect profits, but one cannot truly disguise compassion. That is the point.

How can I get attention to executives who don’t really care? I do some kind of exposure therapy. Some “lunch and learning” watching footage of death and destruction due to climate change. Address these issues not only as a business owner who tackles the challenges that climate change poses to business, but as a person who feels the importance of the green planet in his bones and thinks about children in turn. can do. A good world.

As investors through ISA and pensions, we need to continue to demand more evidence of action. If you are not sure that your actions are genuine and effective, you are at risk of losing your habits and investments.

The ability to vote as a shareholder is a valuable underutilized tool. If you are a member of a mutual insurance company or a building-and-loan association, you can forgive your lost notes, but you can vote.

Great NGOs and charities that you can follow to get more independent information about how financial services companies and those investing in them, such as Banktrack, Carbon Tracker, ShareAction, and Taskforce, are tackling climate issues. There are several. Climate-related financial disclosure, and Greenpeace and Friends of the Earth.

These are worth checking out, especially if you are a shareholder and want to vote for climate change resolutions. If you feel that you have not received enough details to make an informed decision, you can also contact the company for solution details.

In the meantime, keep a pinch of the salt handy. We have deliberately reached there, the jury still seeks honesty.

Net Zero: Why Carbon Neutral Pledge Keys Are Honesty

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