An investor’s guide to climate change: the simple and surprising facts
Most of us have heard about global warming and its effects, but how much do we really know about how human activity is harming the environment?
Climate change is real, it is being driven by record and still-rising greenhouse gas emissions and human activity is mostly responsible for it. The impact of global warming is becoming uncomfortably tangible.
Every year, more and more people around the world feel its effects through recurring extreme weather events that harm life and property and dislocate populations.
The good news is that we are concerned enough for Greta Thunberg to be immediately recognisable around the world. The bad news is that we are not scared enough. Despite all the policy action in the last decades, greenhouse gas emissions are still increasing and the planet is still warming.
Perhaps the key lies in climate change literacy. Most of us have heard about global warming and its effects but how much do we really know about how human activity is harming the environment? For example, did you know that:
- Despite the drop in greenhouse gas emissions due to Covid-induced lockdowns worldwide in 2020, the concentration of greenhouse gases now stands at record levels (Source: World Meteorological Organisation)?
- We are on course for a 3.6 degrees Celsius increase instead of the 1.5 degrees envisaged by the Paris Agreement (Source: Schroders Climate Progress Dashboard)?
- Our use of cars has almost five times the carbon footprint of flying (Source: Our World in Data)?
- If all the plastic we have discarded in the world were cling film, we would be able to wrap the whole planet one and a half times in it (Source: Mike Berners-Lee, How bad are bananas?, 2020)?
- Chocolate has almost the same carbon footprint as beef (for dairy) the main culprit being the land use impact of growing cocoa (Source: Schroders)?
- The fashion industry accounts for 10% of annual global emissions and is a major driver of deforestation and soil degradation (Source: European Parliament Think Tank)?
- Our use of phones, computers, tablets, TVs, networks and even cryptocurrencies accounts for 2.5% of global emissions (Source: Mike Berners-Lee, How bad are bananas?, 2020)?
This paper puts together some facts about climate change that can help all of us better understand climate change and the role that human activities play. It also makes some suggestions about actions that we can take as individuals to manage our carbon footprint and explains what Schroders is doing as an investor and a company.
Reading this may get scary at times but please do not look away!