I have the pleasure of working with Stephen Nolan, who is the head of the UN Environment Financial Centres for Sustainability (FC4S). They just published a working paper on the implications of the COVID-19 pandemic on sustainable finance. I think it is high time to look at this as an opportunity. Let’s not waste another crisis. Let’s go intrapreneurial.
Highlights from the report
Here are a few highlights:
- Sectors with high environmental risk exposures (e.g. fossil fuels) are likely to face increasing environmental scrutiny.
- Securities class action suits stemming from COVID-19 have already been filed against cruise lines (alleging false statements regarding the risk of the pandemic) and pharmaceutical companies (alleging false claims pertaining to vaccines). While these examples are not immediately relevant to climate or sustainability issues, they offer a view into how financial market participants may react to future market disruptions or large-scale mortality events. Many of which (including future pandemics) could have climate change or biodiversity loss as a root cause.
- In jurisdictions with binding emissions reductions commitments, such as the EU, the legal foundation and political environment for crafting a green stimulus is stronger.
Tax, legal exposure, risk, regulation
I normal English, the government is going to tax you for carbon emissions and pollution, you are going to get sued, and stimulus packages will be linked to sustainability.
That means that you need to fundamentally re-assess your current business model. One way of doing this is through the filter of looking at is from a business opportunity perspective. 90 trillion. Bigger than the internet. To be deployed in the next 30 years.
Climate change is an ideal source of opportunity and innovation for banking, insurance and fintech sector. And that is why Sustainable Nation, together with Climate-KIC, created the concept of an intrapreneurship accelerator for the insurance, banking and fintech sector, focussing on climate change as an opportunity.
An ongoing commercial product development pipeline
It is a programme where, through internal idea mining, ongoing selection and assessment, combined with a top-class business development programme, companies can safely explore the opportunities and develop new products and services. Within the commercial, regulatory and risk parameters that they have set themselves. With access to a European network that is second to none in expertise and connectivity. An ongoing product development pipeline. A programme that does not stop until the first commercial product is launched.
If you want to find out out more or want a copy of the working paper, drop me a line.