While 2020 may have been tumultuous, 2021 was the year that the world woke up, according to Rob Gardner, director of investment at St. James's Place Wealth Management.
Speaking to FTAdviser, he described 2021 as “another momentous year” which at a glance, could be dismissed as the second year defined by the pandemic’s shadow.
But he said: “For me, 2021 was about creating positive change for future generations,” he said. “The year the world woke up to the immediate need to reassess and rectify our relationship with planet earth.
“Increasingly frequent extreme weather events have shown us what happens when nature bites back; pivotal to our raised awareness of the necessity to act now to save the precarious future of the planet we live on.”
Gardner said he attended the Cop26 UN Climate Change Conference in Glasgow in 2021. He commented: “Science has hardened over the years [to] show climate change is happening and is real."
He explained that it is already leading to widespread human suffering and billions a year in financial losses.
“The story I believe we will be telling future generations: 2021 was the year the world woke up,” he said.
“For too long we’ve assumed that as individuals we hold neither the influence nor power to make a difference. But we are now realising that it is not only companies that have a direct impact on people and planet, but planet and people that have a direct impact on companies.”
Gardner explained climate change can disrupt supply chains if there are floods, droughts, or fires and said one approach to take would be incentivising companies that are making changes.
This in turn will force companies with a negative impact to readdress their ways of working and make changes for the better.
"If society thinks that a company or brand is not acting in their best interest, they can boycott those brands or, better still, incentivise brands and businesses through collective investment to operate in a way that is going to leave the planet in a better state than it is now,” he added.
“Money talks and reducing this crucial supply of capital is how we have a seat at the table and get the leaders capable of making huge changes to listen."
He explained that a better approach is giving the companies who have figured out how to run their businesses in a sustainable way a financial boost.
“There are companies like this in all sectors, and access to more capital creates a greater and quicker impact, helping them to outlast those that don’t make critical changes to transition to a net-zero way of operating.”
Gardner said this approach delivers strong returns for investors and the pandemic taught the world that people can simplify and live more sustainably.