Do more to tackle climate change, Welby urges City investors

02 July 2018

LONDON STOCK EXCHANGE

The Archbishop of Canterbury (centre) after opening the London Stock Exchange, with the First Church Estates Commissioner, Loretta Minghella; the Bishop of Manchester, Dr David Walker; and the Bishop of Salisbury, the Rt Revd Nicholas Holtam

The Archbishop of Canterbury (centre) after opening the London Stock Exchange, with the First Church Estates Commissioner, Loretta Minghella; the Bish...

THE dream that future generations will have better lives than the present will fade unless investors persuade companies to do more to tackle climate change, the Archbishop of Canterbury said on Monday.

The Church had been “too late” to respond to climate change, he admitted.

Archbishop Justin Welby was speaking at a summit at London Stock Exchange, to raise the profile of the Transition Pathway Initiative (TPI).

The TPI has developed an online data-analysis tool to help investors to assess how effectively companies are addressing climate change (News, 13 January 2017). Over the past two years it has gained the backing of investors who hold more than £7-trillion-worth of assets, among them the Church Commissioners and other church bodies.

Archbishop Welby spoke after he formally opened the Stock Exchange for the day’s trading at 8 a.m. He said that climate change was an “existential problem” that would “control us — not a problem we can control, if we allow it to get out of hand”.

He had witnessed the impact of climate change in the South Pacific earlier this year, he said; it was “literally a matter of life and death”, not just a “future problem”.

“We are called as human beings to exercise stewardship,” Archbishop Welby told the audience made up of investors. “That is why Churches, thankfully now, but generally too late if one is honest, around the world are calling people to a renewed respect for the integrity of creation.”

The Church did not have the “luxury” of “telling people ‘you need to do this’”, he said. Churchpeople “must not just state our beliefs; we must live them out”.

He went on: “This is why the TPI is an example of how the Church, in partnership with others, can play a leading role. For those who represent the TPI, the £7 trillion can literally change the weather.”

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Archbishop Welby suggested, however, that the fight against climate change was “not yet gathering the traction that it needs”.

He said: “It is not enough. We are not yet on track for two degrees, let alone 1.5, and days like today must step up like ambition if they are to be worth the time and trouble of those who come here. . .

“It is not yet too late to avoid the uncontrolled, unchangeable, and dramatic disruption which would mean the hope of our children and grandchildren having better lives than we do would become a fading dream.

“We have the opportunity to turn that round, and say that the generations to come can look back in gratitude rather than condemnation. It needs a heavier lift than we have at the moment, and I hope today can change that and take it forwards.”

Archbishop Welby spoke following the release of the TPI’s new report The state of transition in the coal mining, electricity, and oil and gas sectors , which assesses the “carbon management and perfomance of 105 of the world’s largest and highest-emitting public companies”.

The report identifies that companies have made progress on improving their carbon and climate-change policies, but are still far from meeting the targets of the Paris Agreement.

Companies were assessed on the basis of their “Management Quality”, which means the management of greenhouse-gas emissions by a company; and “Carbon Performance”, the analysis of the progress of emissions-reductions by a company against the benchmark of the Paris Agreement.

In the management-quality section of the report, the average company assessed ranks between levels two and three, and is therefore moving “from building capacity to manage climate change, to integrating the issue into operational decision-making”.

The report says that such a company “has explicitly recognised climate change as a business risk/opportunity and made a policy commitment to action, and is at the point of setting an emissions-reduction target and disclosing operational emissions”.

Thirty per cent of companies analysed go further than this: six companies in particular go beyond the measures put to them by the TPI.In terms of carbon performance, the report says that there has been “measurable progress”: companies have implemented a “wide range of carbon-management practices”. It goes on to say, however, that “most companies still do not take a strategic approach to climate change. . . . Therefore there remains much to be done.”

Also during the event at the Stock Exchange, the Church of England Pensions Board invited asset managers to collaborate with them on the creation of a new low-carbon index that would build on the data and analysis produced by the TPI.

Alan Fletcher, who chairs the Pensions Board’s investment committee, said: “We are committed to doing all we can and creating an index we believe will both meet our investment needs, minimise our exposure to poorly rated companies, reward those that are managing the transition, and reinforce our engagement with energy-intensive companies.”

Other participants were Loretta Minghella, First Church Estates Commissioner (Features, 23 March), and the Bishops of Manchester, Birmingham, and Salisbury.

Last month, Operation Noah released a report which recommended that the Church should disinvest rapidly from fossil-fuel companies in favour of cleaner alternatives (News, 15 June).

The General Synod will debate two motions on climate change on Sunday, and will be asked to give its backing to the National Investing Bodies’ (NIBs’) policy on climate change and fossil-fuel investment, which continues to see investment as a means of influencing company policy (News, 15 June).


Read more in our letters pages this week.

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