The Challenge of Patience in a World of Climate Change
Sean Penrith, The Climate Trust
April 29, 2016
As a species, humans are indelibly impatient. This is wildly out of sync with the inexorable patience of Mother Nature. The impact of the collision between our impatience and our planet’s largesse is playing out before our eyes.
I was speaking to an investor a few months ago about conservation finance flows—around $400 billion per year—that need to be channeled into sectors to mitigate greenhouse gases and arrest global temperature rise. “We can’t wait 7 years for payback,” he said when I explained that many of the project opportunities in our portfolio needed a term of around 10 years to materialize the full yield of carbon reductions and investment returns.
The same impatience is seen in this year’s chaotic election process. The surge to determine the GOP nominee is overshadowing our changing climate. John Kasich is the only Republican candidate to state that climate change is a problem. The impatience to land the White House is undermining the ability for the Republican Party to even begin to think about climate change in the long-term; and this has significant impact on roughly a third of the populace.
Our planet has been more than patient. Through the 20th century, the true North Pole has been shifting ever so slightly towards Canada. But in the few years since 2003, Greenland has shed 600 trillion pounds of ice per year. According to the latest NASA study, this has an impact on the way the Earth wobbles on its polar axis. If current trends continue unabated as we head towards 2100 and surface temperatures increase by just 4 degrees, catastrophic weather events will create havoc for multinationals, small businesses, and citizens around the globe.
Many of the developing nations are eager for the Paris climate agreement to be ratified as soon as possible. More than 130 countries are due to sign the agreement in New York on April 22 this year. The hope is that locking in commitments from at least 55% of the participating nations will ensure at least four years of U.S. participation, even if an anti-climate change candidate wins the presidency in 2016.
We should of course be impatient when taking definitive steps to change course. We stand to lose global financial assets totaling $2.5 trillion if we don’t reign in carbon emissions. Why are some people in positions of national leadership patiently standing by and watching this massive risk unfold?
Some people are not waiting to take advantage of the opportunity in front of them. Saudi Arabia is planning a $2 trillion post-fossil fuel era fund to help diversify the Kingdom’s revenues. Their timeline is 20 years. Elon Musk must have been hugely satisfied to see more than $10 billion accrue in pre-orders for the newest Tesla model within a few days of opening the order book. (For context, it took Apple more than six months to achieve the $1 billion mark from the sale of iPhones.) The massive US Department of Defense is not dawdling either, taking active steps to address climate change under DOD DIRECTIVE 4715.21. In its report to Congress, DOD spoke plainly, saying that it “sees climate change as a present security threat, not strictly a long-term risk.”
The Canadian Pension Plan Investment Board nailed it in 2014 when it said, “we consider responsible investing simply as intelligent long-term investing” when referencing the value of managing ESG (environmental, safety, and governance) factors for organizations. What can be more responsible than investing in climate change? That responsibility requires us to be patient and think long term. But we have to impatiently demand action from world, state, and county leaders now.
P.S. I will share this piece with that dubious investor I mention; seven year payback is the new norm!
Image credit: Flickr/Daniel Horacio Agostini