Carney himself had to walk back comments claiming that Canada’s Brookfield Asset Management Inc., where he now works, is net-zero because of emissions it avoided by investing in renewable energy. The remarks prompted backlash from experts because they don’t require a company to actually cut pollution, or, in Brookfield’s case, actually stop funding fossil fuels.
The thing all three projects have in common, and what activists warn against, is their advocacy for voluntary action. As regulators wise up to greenwashing and governments face pressure to take stronger enforcement measures, the finance industry has a vested interest in helping set the rules going forward.
“I prefer capitalists self-regulate,” Larry Fink, the Chief Executive Officer of BlackRock Inc. who has quickly become one of the best-known champions for greater corporate climate action, said at a Bloomberg event in January. “I’m a major believer that capitalism understands this and we’re moving forward. We’re moving forward because it’s good for business.”
There are signs that real, progressive change can happen under the current system, especially when activists work with investors to push for change.
On Thursday, HSBC Holdings Plc announced tougher climate goals after pressure from non-profit ShareAction and shareholders including Amundi SA and Man Group Plc. Significantly, the bank will phase out coal funding by 2040.
The financial sector can, it seems, hold itself to account occasionally. But that isn’t enough to guarantee the kind of emissions reductions we need to avoid the worst effects of global warming. When it comes to climate change, the stakes may be too high for governments and the public to wait and see if Big Finance can solve the problem on its own.
This article was provided by Bloomberg News.