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In the 1990s, companies bore the responsibility for global warming. From now on, it is the institutional investors who have inherited it. Can this question really be solved by finding a single culprit?
Last year, the Federal Office for the Environment and the State Secretariat for International Financial Affairs launched a study on the climatic compatibility of Swiss pension funds and insurance companies. The participants represented two-thirds of the assets managed by Swiss institutional investors and this exercise made it possible to assess the consistency of their investments in equities and bonds with the CO2 reduction objectives of the Paris Agreement.
Recall that this agreement, approved by some 200 signatories, including Switzerland, confirms the willingness of states to reduce greenhouse gas emissions. It is now commonly accepted that these are partly the cause of global warming and that if this phenomenon is not stopped, it could generate serious problems for humanity (melting poles and increasing the level of sea, natural disasters, population displacement, loss of species, depletion of resources, etc.).
According to the study, investments by Swiss pension funds and insurers are far from the objectives of the Paris Agreement. Overall, the scenario with which they are compatible according to the models used in this analysis is that of a warming of 4 to 6 ° C compared to the pre-industrial era, ie above the threshold of 2 ° C set by the agreement to allow emissions to stabilize at a level deemed reasonable.
Change of way of thinking
Surprising? Not that much, since the main global stock market indices (such as the MSCI World) are compatible with a warm-up scenario of around 5 ° C. And as institutional investors invest mostly in line with these indices, it is logical that the warming trajectory of their investments is similar.
More generally, it is the question of responsibility for the environmental impact of industrial and commercial activities that is at stake here. The premise of this study - and the Paris Agreement - is based on the idea that it is the investor who bears this responsibility. But is this really the case?
Today we are witnessing a change of way of thinking. In the 1990s, especially after the UN conference in Rio in 1992, it was generally considered that the companies bore this responsibility and the role of the "culprit" has since been carried over to other areas. , those of investors, particularly institutional investors. These are easy prey because their investments are subject to regulations that can be changed. Should we expect legislation requiring them to take into account global warming?
However, if so, the problem would not be solved. Institutional investors have only limited power, because they have to invest in the vast majority of cases by closely following stock market indices, which reflect the real economy and are themselves as we have seen on a trajectory. significant warming. The problem of global warming can not be solved by seeking a single responsible. It will have to be solved by a global approach, in which each of the stakeholders assumes its share of responsibility: investors who make capital available, companies that manufacture goods, not to mention ... the consumers who buy them. The fact that they are also voters complicates the search for solutions: do they really want to hear that they are co-responsible, through their consumption, global warming and see effective measures, but unpopular, put in place to reduce it?