Governments are getting serious about reducing CO2 emissions – with over 80% of global CO2 emissions “pledged” to be eliminated if we include what is currently in policy documents.
“The number of asset managers and asset owners that are signatories to the Principles for Responsible Investment – thereby committing to incorporate environmental, social, and governance considerations into investment analysis and decision-making processes – more than doubled from about 1,400 in 2015 to more than 3,000 in 2020“
The US government estimate of fleet maintenance costs found that battery-electric vehicles (BEV) have about 40% lower cost when compared to internal combustion engine vehicles (ICEV).
Hybrids (HEV) and plug-in hybrids (PHEV) also save money.
NB this 4c per mile difference across the nearly 2 billion miles federal government vehicles covered in 2019 equates to $78 million a year in savings, and that doesn’t account for fuel costs.
Sobering chart – despite (or because of) a 97% rise in human population and 285% rise in GDP, since 1970, the population of vertebrate species has declined -60%.
Bloomberg analysed how well companies fared against their 2020 climate goals (set in 2015).
“The good news is that most of these pledges—138, so far—have already been met or appear on track by year-end, in part because many companies set modest goals.“
Worryingly, data disclosure remains a big issue as many companies either don’t report or do so unevenly.
Looking forward many are now making stand out statements.
Microsoft has not just committed to going carbon negative (by 2030) they will, by 2050, remove from the environment all the carbon the company has emitted either directly or by electrical consumption since it was founded in 1975.
Current ESG scores are contradictory as seen in the chart showing correlation across providers.
This point, rarely raised about ESG, argues that markets adjust to price things in – “If there is an investing lesson embedded here, it is the unsurprising one that investors who hope to benefit from ESG cannot do so by investing mechanically in companies that already identified as good (or bad), but have to adopt a more dynamic strategy built around either aspects of corporate social responsibility that are not easily measured and captured in scores, or from getting ahead of the market in recognizing aspects of corporate behavior that will hurt the company in the long term.”
Is ride-hailing good for the green house gas emissions?
“The answer from several recent studies is straightforward: after accounting for people who would have taken public transport, biked or walked instead, and those who would not have traveled at all, there’s a substantial net increase in estimated vehicle miles traveled and emissions from ride-sharing, possibly as large as 60%-80% compared to a world with no ride-sharing at all”
Charts tell this story – (clockwise) a surge in ride-hailing in the US including NYC coupled with increased emissions per trip and miles travelled compared to the category they replace.
Sourced from this great note on Energy market outlook.
The Department of Labor (DOL) has proposed a rule that might ban the ability of corporate sponsored retirement accounts (e.g. 401(k)s) from holding ESG Funds.
“Private employer-sponsored retirement plans are not vehicles for furthering social goals or policy objectives that are not in the financial interest of the plan,” said Secretary of Labor Eugene Scalia. “Rather, ERISA plans should be managed with unwavering focus on a single, very important social goal: providing for the retirement security of American workers.”
