Addressing climate change will require the largest reconstruction of the global economy since the Industrial Revolution, according to a recently published report.
The report, by index and data provider MSCI, highlights how capital markets participants must be a powerful and positive force to urgently drive the systemic transformation needed to avert climate catastrophe. This call to action identifies specific steps that companies as well as owners and managers of capital must take to drive the achievement of a net-zero greenhouse gas ( GHG ) emissions economy by 2050.
Analysis by MSCI of its All-Country World Investable Markets Index - a measure of approximately 9,000 publicly listed companies across 50 developed and emerging markets with a market value of over US$70 trillion – revealed those companies annually emit an estimated 11.2 gigatons of carbon-dioxide equivalent ( CO2e ). The model indicates that, without any change to current practices, the annual emissions of these companies could reach 16.8 gigatons of CO2e by 2050, leading to a planet that is 3.5˚C warmer by the end of the century. This trajectory demonstrates the tremendous challenge in reaching net-zero and the urgency to act now.
Therefore, the company calls upon:
Henry Fernandez, MSCI’s chairman and chief executive officer, says: “Capital markets are an essential and critical force to drive the transition to net-zero with concerted action from all participants, ranging from a reallocation of capital by asset owners, to effective channelling of funds by asset managers and banks to greener investments and innovation, alongside the commitment of companies."