UN delegates agree on landmark ocean biodiversity treaty
After days of negotiations, a ‘significant majority’ of UN countries agreed a treaty to protect ocean biodiversity in international waters, an important victory for conservationists and the broader environmental agenda. The treaty’s principal achievement is establishing a legal framework for creating Marine Protected Areas (MPAs) in international oceans, which will allow for enforcement against overfishing, mining or other activities that threaten biodiversity.
International waters cover nearly half the planet, but currently a mere 1.2% of it is protected, putting a vast amount of marine life at risk to human activity. A treaty of this kind is vital for achieving the “30×30” goal set at the COP15 biodiversity conference in 2022, to protect 30% of the planet by 2030.
To become enforceable, UN countries will have to ratify the treaty in their respective national legislatures – which is no foregone conclusion. Nevertheless, as UN General Secretary Antonio Guterres put it, “we can no longer ignore the ocean emergency”. If nations are sincere in their stated desire to protect biodiversity, protecting ocean life must be a key pillar of their strategy.
FAIRR, WWF and Planet Tracker launch new engagement initiative for seafood investors
A group of investor coalitions, NGOs and think-tanks including the WWF, FAIRR and Planet Tracker launched a new initiative to aid investors in their efforts to engage with seafood companies on vital biodiversity and climate issues. According to a press release from FAIRR, the initiative will “convene a group of like-minded investors to conduct targeted engagement with key seafood companies”.
The initiative will “support the investor group to develop targeted asks and leverage their collective power to strengthen companies’ commitments to and implementation of best practice in seafood sustainability.” Jo Raven, Director of Thematic Research & Corporate Innovation at FAIRR, said “We’ve seen how the collective engagement format supports pre-competitive peer-to-peer learning. We think the potential to address seafood risks in this format is huge.”
Seafood is a key global industry that provides much of the world’s food supply, but has often been perceived as a bad actor in the fight to protect the environment and global biodiversity. Investors have a key role to play in ensuring companies remain accountable to and compliant with internal commitments and international standards.
Biden expected to use his first presidential veto to block anti-ESG legislation
After a surprise defection by two Democrat senators, the US congress moved to pass a resolution that would effectively ban retirement plan managers from incorporating ESG considerations into their investments. However, this resolution is unlikely to become law, given that President Biden has repeatedly stated he would veto it.
This veto, if used, would be President Biden’s first. His willingness to employ such a tactic shows his strong commitment to ESG and climate finance more broadly which he has repeatedly shown during his first term. His administration has softened regulations around incorporating ESG factors into investment decision making, allowing them to become a more prominent part of the US investment environment. Many Democrats have rallied around ESG as a free market solution to environmental and social issues, and argue that Republicans, by acting against it, are unfairly distorting the economy for ideological ends.
Republicans, however, decry ESG as a form of “woke investing” – an attempt to inject progressive values into all streams of daily life, destabilising fiscal security in the process. This conflict has reaffirmed the predictions of many after the results of the midterms, that ESG would become a more prominent issue in US politics in a divided congress.
UK’s lack of energy infrastructure threatens the net zero transition according to new internal report
A new report from the UK’s National Audit Office (NAO) revealed shocking deficiencies in the Government’s energy infrastructure planning, revealing that generators were being paid up to £62 million a day to cut output because electricity could not be effectively stored. NAO chief Gareth Davis argued that the lack of an effective plan to modernise the UK’s power system risked undermining industry and investor confidence.
While the UK government has set out ambitious goals for all domestic electricity to be generated using clean sources by 2035, a lack of effective infrastructure could prevent power from being delivered efficiently and safely, increasing costs and deterring further investment.
Investment in electrical grids is vital for the growth of renewable energy. Without the necessary cables to deliver their electrical output, sustainable power sources cannot be effectively used. For investors concerned with the growth of these new technologies, attention should be placed towards lobbying governments and utility companies to build further infrastructure.
Amid debate over green subsidies, the EU makes its case as a green leader
The unprecedented levels of green investment brought about by the Inflation Reduction Act in the US has caused many nations around the world to raise the bar in terms of their own efforts to bring about a sustainable transition. EU lawmakers, who in recent months have been on the defensive in public about the US bill and its potential to harm Europe’s green energy market, have begun making the case that the bloc’s current and planned investments equal and in some ways exceed that of the US.
According to this data provided by the European commission, European countries collectively invest far more than the predicted annual spending in the Inflation Reduction Act. Just last week the EU carbon market, which rewards companies that innovate in sustainability, reached an important milestone that saw allowance prices for a tonne of carbon reach €100 for the first time. EU officials also highlighted their REPowerEU plan that bolstered its members’ ability to transition away from fossil fuels.
These measures are likely part of a strategy to calm a market that had been bombarded with messaging about the Inflation Reduction Act’s scope, which many European decision-makers believe will entice green industries to abandon the continent and discourage investment in Europe. While the EU has often been a leader in terms of government-financed green initiatives, it has lagged behind the US and China when it comes to private green investment, with venture capital funding for green projects in the EU27 amounting to less than a quarter of that seen in North America.