Why Climate change will be a ‘really big’ focus for ESG investors in 2021, plus Scotiabank becomes fifth major Canadian bank to refuse to fund oil drilling in Arctic refuge. Scientists discover a ‘climate refuge’ for coral discovered off coast of east Africa, and a British science mission sails south toward a giant Antarctic iceberg to measure its impact on the environment and local species.
Brits Measure Massive Iceberg,Scotiabank Stops Funding Future Arctic Oil Exploration, East African Coral Refuge, and ESGs Focus on Climate Change
CLIMATE CHANGE WILL BE “REALLY BIG” FOCUS FOR ESG INVESTORS IN 2021
Environmental, social and governance investing is setting up for another big year. After an “extraordinary year” in 2020, ESG-themed investments should continue their hot streak as interest in sustainable and socially responsible investing grows, this according to CNBC.
ESGs attracted a lot of attention, both in terms of the companies and what they’re doing from an ESG perspective in 2020, despite the twin pandemics of coronavirus and the resultant economic downturn. More interest and growth is expected in 2021, said Linda Elling-Lee Managing Director of MSCI’s ESG Research.
“Despite all the lockdowns that we’ve had this year, we’re still on track for a world that is going to be too warm to sustain life as we know it, according to climate science,” Lee said. “You’re going to see lots more investors really shifting capital towards less carbon-intensive assets.”
MSCI advises 5 ways to sustainably invest in ESGs:
#1 – Climate Reality Bites: Actually, We May Not Always Have Paris: In 2021, investors committed to aligning with the Paris Agreement face a steeper climb ahead: persuading companies to make radical changes or face a rapidly shrinking universe of qualifying investments.
#2 – Beyond Boom and Bust: ESG Investment Finds Its Footing: In 2021, we see both hype and skepticism about ESG giving way to a more nuanced understanding of when and how ESG has shown pecuniary benefits — and when it hasn’t.
#3 – To Bee or not to Bee: Investors Tackle the Biodiversity Crisis: During the darkest days of the pandemic, emboldened wildlife roamed residential streets. The virus has reminded us of what we’ve unwittingly lost: nature, critical not just for personal pleasure but for sustaining the global economy. In 2021, policymakers and investors will heed the alarm on biodiversity loss, adapting a playbook they had established for measuring and managing climate risk.
#4 – The ESG Data Deluge: Sink or Swim for Companies and Investors: When it comes to ESG reporting and establishing a sustainability strategy, it’s clear that companies are stepping up their game.
#5 – Righting the Scales: Social Inequalities Test Investors’ Creativity: COVID-19 has put its thumb on the top 1% side of the wealth scale, undoing decades of progress toward greater equality. In 2021, savvy investors will take steps toward more creative, systemic approaches to reduce inequalities, with those in the vanguard willing to risk a few failures in pursuit of solutions.
SCOTIABANK FIFTH LARGEST CANADIAN BANK TO REFUSE FUTURE FUNDING OF OIL DRILLING IN ARCTIC REFUGE
The fifth largest bank in Canada Scotiabank has publicly refused to fund oil drilling in Alaska’s Arctic National Wildlife Refuge. Reported by the Narwhal, Scotiabank released a new policy announcing the bank will not provide direct financing or project-specific financial and advisory services for activities related to oil and gas production within the Arctic Circle.
The Royal Bank of Canada, Bank of Montreal, Canadian Imperial Bank of Commerce and other major financial institutions in Canada have already vowed to not finance developments in the Arctic Circle where a roughly 1.6-million-acre oil-rich region lay.
In early 2020, five major US banks also pledged not to finance developments in the Alaskan refuge, including Goldman Sachs, Wells Fargo and J.P. Morgan Chase.
In an interview with the Narwhal, the campaign coordinator with the Yukon chapter of the Canadian Parks and Wilderness Society said the coordination among the financial sectors will hopefully make companies think twice about funding developments in the refuge.
DEEPER DIVE: The Narwhal
CLIMATE REFUGE FOR CORAL DISCOVERED OFF COAST OF EAST AFRICA
In a rare ocean cool spot off the coast of east Africa, scientists have discovered a diverse ‘climate refuge’ where coral species are thriving despite rising ocean temperatures due to climate change, reported by The Independent. What researchers have described as a “jewel of biodiversity,” the newly-discovered coral reef is located off the coasts of Tanzania and Kenya in the Indian Ocean.
At first, Wildlife Conservation Society (WCS) scientists could not understand how the region developed such diverse marine life. However, scientists now hypothesize that the rare cooler temperature spot is protecting the coral species and helping the local marine mammal species thrive.
Still, scientists warn that future coastal development and overfishing could result in irreversible devastation to the vibrant marine ecosystem.
DEEPER DIVE: The Independent
SCIENCE MISSION TO INVESTIGATE FROZEN GIANT FLOATING IN SOUTH ATLANTIC OCEAN
Led by the British Antarctic Survey, a team of scientists WERE recently sent to study a giant iceberg in the South Atlantic, known as A68a. Reported by the BBC, the iceberg is currently offshore of the British Overseas Territory of South GEORGE-UH and threatens to drift into shallow waters, which could greatly impact the habitat for surrounding wildlife including penguins and seals.
The scientists plan to approach the iceberg aboard the Royal Research Ship James Cook and use robotic underwater gliders to acquire measurements under and around the iceberg.
In an interview with the BBC, a British Antarctic Survey oceanographer said the scientists will monitor the water temperature, salinity, and chlorophyll concentration to understand how the iceberg influences the environment and its species.
DEEPER DIVE: BBC