Joe Gill: Wall of money ready to drive climate change projects – Irish Examiner

A wave of green change is sweeping across the corporate landscape and they have profound consequences for the way in which all of us will be employed and how we will consume, writes Joe Gill.

No one should underestimate the power of large institutional investment firms as they react to the mega theme of environmental change.

Over the past two years, in the investment business in which I work, we have noted a sharp step-up in the focus being given to all things linked to sustainability and climate change.

This has come from the top as board directors and senior executives have chosen to shift gears in how they deploy capital.

Increasingly, if as a company you want to attract debt or equity finance, you will have to prove at a minimum that you have started a journey towards sustainability.

The power of money will have a greater effect on behaviour and investment decisions than any amount of protesting.

Companies worldwide are recognising the need to change tack, encouraged no doubt by consumers and employees advocating the need for change.

The corporate response is multifaceted.

Individual companies can start by converting their own internal business operations.

A switch to 100% electric cars, the abolition of single-use plastics, full recycling of all waste and a reliance on renewable energy are ways in which industry can move the dial.

At another level, companies can change their product suite to incorporate environmental priorities.

Packing products in fully reusable boxes instead of plastic is one option.

Another is to change whatever is being produced in to a 100% recyclable product.

Other companies are being created to fully exploit the sustainability agenda.

Power companies that rely completely on renewable energy are a good example of that.

Food companies that manufacture food in ways that do not damage the environment are another.

The trends are only going to grow and expand in the months and years ahead.

The investment community does not expect companies to convert overnight.

Instead, they look for boards and management teams that commit to a journey of change.

Once a detailed plan is put in place, and authority is given at a senior level to an accountable post holder who reports to the board, investment firms are supportive.

This explains, for example, why large asset managers are staying supportive of a fossil fuel company like BP because it has laid out concrete plans to move to a zero-emission footprint within a determined number of years.

Every private company and public sector employer will have to respond in kind.

Politicians and regulators will add pressure too but it is those who supply finance that has the greatest influence on how businesses and civil servants react.

If a bank or an investor provides money at a discount to those who pursue true climate change strategies it has a major impact.

Equally, if those providers decide to charge a premium for access to finance if companies do not change their behaviour it has the same result.

In recent weeks, amid a string of negative news stories, there was a fantastic development in the South Atlantic.

Researchers found there 55 thriving blue whales.

For decades the number of whales in that area had collapsed to single figures as whale hunting had driven the species close to extinction.

Moreover, the numbers suggest the oceans continue to have the health needed to sustain these creatures.

It was politicians and money providers that put a stop to whale hunting and look now at what impact that has.

Ignore those who tell you responding to environmental damage is worthless.

A huge amount of change is now kicking off and if everyone supports it climate change can be addressed and tackled appropriately.

--Joe Gill is director for origination and corporate broking with Goodbody Stockbrokers, His views are personal.

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Joe Gill: Wall of money ready to drive climate change projects - Irish Examiner