The past assumption that markets and technology will find a way to halt environmental breakdown is being openly questioned.
We’re living through a historic moment of climate realism. Australians who grinned and voted for a right-wing government – in the knowledge that it would go on blocking global action on climate change – aren’t grinning anymore. Their country is on fire.
And now BlackRock, which manages $7trn of capital on behalf of global capital, has been forced into a “fundamental reshaping” of its investment strategy. It will pull billions of dollars out of companies which make money out of coal mining, change its risk-management calculations to factor in climate change, and – it says – start voting against boards of companies that don’t take climate change seriously.
The move has been greeted by an outpouring of justified scorn by climate NGOs. It’s too little, too late and takes no responsibility for the billions of tonnes of carbon emitted by firms BlackRock has financed since its foundation in 1988.
But it’s still a significant moment, and to be welcomed. The fund giant’s CEO Larry Fink has basically conceded that there is no capitalism on a dead planet. Read between the lines of his letter to US chief executives and it goes further: there is about to be a “significant reallocation of capital,” says Fink, away from all businesses exposed to the risks of climate change. Even such capitalism as survives on a burning planet might not produce the riches it once did.
Since the science has been clear for at least two decades, Fink’s letter must stand as a tombstone to greed: why weren’t the risk analysis models changed until now? Why wasn’t sustainability placed at the heart of investment strategies at the start of the neoliberal era, before emitting the actual carbon that will tip the earth’s ecosystem into chaos?
The answer is clear: so that rich people all over the world could buy their SUVs, yachts and ski chalets, and so China, Latin America and India could be industrialised, one coal-fired power station at a time. It may have been Australia’s Scott Morrison who made the historically sick joke in parliament, waving a lump of coal around and telling opponents: “it’s nothing to be frightened of”. But the joke was made on behalf of the entire fund management and investment banking industry.
Even now the risks Fink seems to care about are financial – not the primary risk to the planet, its ecosystem and its species. These, as far as capitalism is concerned, are just a kind of host organism for the real, living parasite, which is self-expanding wealth.
But Fink’s intervention is welcome. BlackRock will join ClimateAction 100+ – a group of super-rich investors who have agreed to pressure companies to align their actions with the goals of the Paris Climate Agreement. It will pull money out of coal and the obvious planet-destroyers.
Long experience of the corporate world’s attitude to social responsibility …read more
Source:: New Statesman