Even
before catastrophic fires broke out in Australia in late fall, climate change
was at the top of the list of priorities at the 50th anniversary of the World
Economic Forum in Davos, Switzerland, this week.
But
those fires - preceded by others in California - along with rising sea levels,
flooding and supercharged storms, are putting more pressure on the politicians,
business executives, financiers, thought leaders and others who attend to show
they are part of the solution to one of the world’s most pressing challenges.
In
a nod to a younger generation most at risk and demanding action on climate
change, Greta Thunberg, the Swedish teenager who has become a prominent environmental
activist, is scheduled to appear. In a column this month in The Guardian that
she wrote with other environmental activists, they demanded an end to
investments in fossil fuels.
“Anything
less than immediately ceasing these investments in the fossil fuel industry
would be a betrayal of life itself,” they said. “Today’s business as usual is
turning into a crime against humanity. We demand that leaders play their part
in putting an end to this madness.”
Daniel
Yergin, the oil historian and a regular attendee at the Davos forum, agreed
that “climate is going to loom larger than ever before.” And Ian Bremmer,
founder and president of the political risk firm Eurasia Group, said: “These
issues are becoming more real, more salient every day, whether you are talking
about Venice or California or Australia or Jakarta. These are real events with
enormous direct human and economic costs.”
But
an overriding question as the Davos gathering gets underway is: Will all the
talk matter?
Mr.
Bremmer, who plans to attend, said the forum could help force change because it
brings together big players, like chief executives of banks, money management
firms and hedge funds, who are rethinking their investments. Gradually — some
say too gradually — financial firms are directing money away from oil companies
and others associated with carbon-dioxide emissions blamed for environmental
damage.
Financial
institutions “see the future coming, and they are changing the way they
invest,” Mr. Bremmer said. “That is going to require multinational corporations
to act differently; it will lead to new corporations that will do better.”
While
thinking on climate change may be shifting, by some metrics the corporate elite
that always makes up a large contingent at Davos still has a lot of work to do.
According to a study published in December by the Davos organizers, only a
quarter of a group of 7,000 businesses are setting a specific emissions
reduction target and only an eighth is actually reducing their emissions each
year.
If
so, they are making a major strategic error, according to Mark Carney, the
departing governor of the Bank of England who planned to be in Davos. Companies
that work to bring their emissions to zero “will be rewarded handsomely,” Mr.
Carney said in a recent speech. “Those that fail to adapt will cease to exist.”
Some
people in the financial industry said that environmental issues were being
given greater weight in investment decisions despite setbacks like President
Trump’s decision to pull the United States out of the Paris agreement on
climate change. The president, who shunned the gathering in Davos last year,
said he would go this time.
The
number of people who are talking about fossil fuels as a real concern “has
increased dramatically over the last 12 to 24 months,” said Jeff McDermott,
chief executive of Greentech Capital, an investment bank focused on low-carbon
technologies. “They are both looking at the risks of high-carbon companies and
industries as well as the returns available from low-carbon alternatives.”
A
Guest Editorial
