Why reshaping the finance system is key to climate change.

Since late 2018, my work has increasingly focused on climate adaptation: Jem Bendell’s Deep Adaptation approach has deepened my view of the crisis, but has also helped me to see ways I can respond actively.  You can see more about my 2020 plans here: Throughout this time, I’ve had a rising sense that the elephant in the climate change room is the financial system.

By now I’ve had numerous conversations about the elephant: even one with Gail Bradbrook, co-founder of Extinction Rebellion.  I was relieved that she believes the financial system can be transformed without it needing to collapse.  However, no one, including Gail, has given me a credible view of howmajor reshaping might happen.

Why do I see this as key to the whole climate crisis? Just put these three points together:

  • Almost everyone agrees that the 2020s are Last Chance Saloon for climate responses.
  • Despite all the good initiatives, 2019 was the all-time peak year for CO2 emissions, ie this major driver is still worsening.
  • It’s clear that globally, business has more power than most governments: and business operates within a system that requires profit maximisation, and does not charge a fraction of the environmental costs that business creates. 

If this leaves you despondent, try reading an old favourite of mine: The Ecology of Commerce, by Paul Hawken.  He eloquently shows how business alone has the power to make the huge, rapid changes we need as a climate response.  And the key to unlocking this power is to change the rules that business plays by.

llustration of a cartoon elephant : Free Stock Photo

Recently, I’ve been chewing hard on how to effect a change in the rules.  My insights so far are to find and use the pressure points for systemic change, and to harness the profit motive rather than choke it off.  My guess is that the pressure points for this change are:

  • The Uber Rich: Whilst their influence is largely invisible, I believe it is one of the biggest.  If the uber rich realise that their personal survival is in jeopardy, that no amount of money can insulate them from what’s ahead, they could enforce huge changes very quickly.  This begs the questions: where and how to reach the uber rich; what evidence and arguments would engage them; and what specific demands would one urge them to make, and to who?
  • Financial institutions: I see plenty of evidence of concern in this sector, which is geared to assessing and minimising risk.  There is already some pressure from institutional investors, the insurance sector, and governing bodies like the Bank of England, demanding greater response to climate change from businesses.  Within this large sector, where are the pressure points, such as organisations, individuals, networks, who are opinion leaders? What proposition for system change could be put to them?

I’m all too aware of the massive vested interests and inertia in the current financial system. But my contacts inside that system consistently report a sense of desperation: most individuals know radical change is really urgent, but as employees of their organisation, they can’t see how to do it.  And let’s remember that systemic changes usually start out looking quixotic, with a handful of people outside the system. 

This blog is a call for connection. I suspect that others are further advanced in this exploration than I am, and if we can join with each other to create coordinated proposals and to infiltrate the system, the changes we need may come to pass.  Where are the opinion leaders and gatekeepers, the role models and precedents?! If you’d like to join the conversations, please contact me.