Scottish Widows’ Eva Cairns called on government policy to introduce financial incentives to reduce emissions and increase carbon pricing, both of which are critical in reaching net-zero, at this week’s Good Money Week conference run by UKSIF.
In the keynote presentation the head of responsible investments and stewardship, addressed the importance of policy and financial incentives in reducing carbon emissions. She highlighted only 24% of global carbon emissions are priced, yet recommendations suggest that pricing emissions between $50-$100 per ton is required to meet climate targets. Scandinavian countries have already implemented carbon prices at around $60, and she urged other countries to follow suit.
Providing advice for investors. she added focusing on systemic risk within sectors and themes is key:“This means looking for risks that will impact sectors such as biodiversity loss will impact many industries such as pharmaceuticals, food and drink or even power generation. Firms should not just pick individual companies that are doing well, but track these systemic risks when recommending investments to their clients.”
Later at the conference, in the panel The View from the Front: What is the public saying?, moderator and head of governance and strategy at UKSIF Madison Reamsbottom questioned what the public’s current priorities are and how they respond to sustainability when it is brought up by firms.
The panelists were:
- Helen Tandy, partner, client advice at Castlefield
- Nick Stoop, founder and chief executive of Pangea Impact Investments
Both speakers touched on the growing interest in climate change and renewable sectors, especially among young professionals. Tandy said there has been a generational shift in values, where traditionally clients only understood the arms trade, mining, and modern slavery. However, more people are ask questions about the impacts of climate change and the renewable sector. She is hopeful “the sector is moving in the right direction.” This comes as “campaign groups are helping to educate people, where traditionally you needed to have a certain amount of wealth to advance investments.”
Lastly, Stoop ended the panel on a high note, suggesting “there are real pioneers in the industry that are looking to change the system and shake up the status quo. An example of this is Circa 5000, who have built five equity ETFs and built indexes, which is encouraging to see. It takes businesses outside the system to create momentum.”
