investment viewpoints

    Can COP26 deliver the roadmap to a net-zero world?

    5 verborgene Emissionsquellen in kohlenstoffarmen Strategien
    Thomas Hohne-Sparborth, PhD - Head of Sustainability Research

    Thomas Hohne-Sparborth, PhD

    Head of Sustainability Research

    Climate transition is one of the largest economic transformations we’ll see in our lifetimes, according to Thomas Höhne-Sparborth, Head of Sustainability Research at Lombard Odier. He spoke to CityWire about the upcoming COP26 conference and investor’s wishlist from it. Here are his top three takeaways.

     

    1) Clarity on roadmaps

    Governments representing about 80% of the world economy have already set some kind of net zero target. What we as investors need is clear guidance from governments on how exactly are they going to encourage that transition to net zero. What technology roadmaps are we going to follow? What incentive or taxation scheme might be considered?

     

    2) Future of carbon pricing

    Carbon prices are likely to be an important and essential tool for the climate transition. We have already seen a number of these regimes emerge and expect a continuation of that. But still more urgently needed is clarity on the future evolution of these carbon prices, as well as better regulated markets with respect to carbon credits or offset schemes.

     

    3) Improved disclosures

    We need to see a mechanism of improved disclosures in terms of specific initiatives. For example, we are supporters of the Taskforce on Climate-related Financial Disclosures (TCFD). Better standardization of investment metrics, including adoption of forward looking metrics, i.e., metrics that allow you to understand which business models are indeed aligned to the transition, will improve clarity, which will lead to improved take-up of these initiatives.

    For the full interview click here.
     

    We at LOIM, are committed to understanding how this climate transition is going to shape risk and return and aim to identify those companies, portfolios and investments that are well positioned for this transition.

    To find out more about our target net zero strategy, read here. We will also be at COP26 to present our views on the transition to a net-zero economy. Click here for more information on the Zero-Hour Sessions at COP26

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