Climate Arc urges investors to target high-emitting sectors for low-carbon future
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Climate Arc, a nonprofit providing guidance, data and funding to promote green investments, argues that climate investors must target the sectors with the highest emissions to advance towards a low-carbon energy future.
In an interview with Bloomberg, Meryam Omi, the CEO of Climate Arc, stated that investors must tackle the “murky part” of climate finance. This means delving into and addressing the complexities and challenges associated with high-emitting industries.
Omi, who previously led the responsible investment strategy at Legal & General Investment Management, emphasizes that money managers need to focus on incentivizing the right behaviours within these sectors rather than simply aligning investments with Net-Zero goals.
This approach involves encouraging companies in high-emitting industries to adopt practices and technologies that significantly reduce their carbon footprints, thereby contributing to the overall transition to a low-carbon economy.
Worldwide, investments exceeding $50 trillion have been pledged towards achieving Net-Zero emissions by 2050. However, these commitments have coincided with increased greenhouse gas emissions, diminishing the likelihood of limiting global warming to the critical threshold of 1.5°C.
Read more: Companies adopting 1.5°C-aligned climate transition plans jump by 44%, data shows
Omi added, “Climate investors have been talking about commitments and targets for a long time, but now we need to talk about the transition. It’s not about 2030 or 2050, but what action do we need to take today.”
Climate Arc’s approach is a shift away from the typical focus of climate activists on exclusionary policies, which often involve divesting from or avoiding investments in industries deemed environmentally harmful.
Climate Arc intends to release its so-called TransitionArc platform during London Climate Action Week, aiming to “unlock transition finance at speed and scale.”
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