Remember COP26? How might this affect your clients' plans this year and beyond?
The global summit to set the targets to tackle the threat of rising temperatures, which is widely regarded as the biggest risk facing mankind, seems to have been held a long time ago - but it was only a few months back.
Since COP26 was held in Glasgow at the end of October 2021, the world has kept turning with, seemingly, very little attention has been paid to what was finally agreed by our leaders.
If that’s a little unfair on the efforts made, it does illustrate the battle that has to be waged to keep climate change on the front pages and leading news bulletins.
Nearly four months on and it seems like a long time ago. If ever there were a parable for our time on how difficult it is to ask the public and decision-makers to focus on the really important at the expense of the politically expedient or immediately urgent, it is this.
As I write, popular streaming service Netflix has joined the fray. One of its Christmas hits was 'Don’t Look Up' – a thinly-veiled allegory of climate change in the shape of a giant comet on an apocalyptic collision course with Earth.
On the surface, nothing much seems to have happened but when it comes to how incorporate environmental, social and governance (ESG) considerations into your financial planning, Netflix is unlikely to fund a movie on this subject.
Happily, it is very much in the top trending tasks for the financial planning industry, because of the rising awareness that the financial services sector can make a significant contribution towards combatting man-made climate problems by allocating assets to influence positive behavioural change.
As a long-term approach, investing along ESG lines is gaining increased visibility. As ever, there’s always a need to help clients understand more closely what it means to them and the decisions for which they want your input.
What can I do?
First let us recap on what was agreed.
The Conference of the Parties (COP26) met in Glasgow between 31st October to 12th November 2021.
Hosted by the UK and Italy, the event brought together 114 world leaders - including those of the US, India and Russia - to agree on actions we can all take to tackle rising global temperatures.
In a video message, Her Majesty Queen Elizabeth II urged leaders to act, and she was joined in the video by others such as Sir David Attenborough.
Some good news seems to have emerged, with historic commitments to tackle global deforestation and methane abuse. The Glasgow Breakthrough Agenda was also signed by 35 world leaders - representing 50% of the global economy - to develop new, clean technologies and drive down costs.