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Top political leaders support divestment to drive emissions cuts

economic benefits of climate action

World Bank President Jim Yong Kim. Creative Commons: Ryan Rayburn/World Bank, 2012

At the World Economic Forum, divestment from fossil fuels received high-profile attention from key leaders, as others drove home the need to make economic reforms in order to rapidly cut emissions by mid-century.

Both World Bank President Jim Yong Kim and UN Secretary General Ban Ki-Moon alluded to divestment in their respective addresses to the annual gathering of political, business, and financial elite in Davos, Switzerland.

Though climate change was already set to be high on the agenda of the World Economic Forum, such prominent mentions of divestment demonstrated the rapid traction that the movement has gained in just a few years.

World Bank President Jim Yong Kim remarked on divestment both as a tactic to cut emissions and as a practical aspect of financial responsibility:

Through policy reforms, we can divest and tax that which we don’t want, the carbon that threatens development gains over the last 20 years….

Be the first mover. Use smart due diligence. Rethink what fiduciary responsibility means in this changing world. It’s simple self-interest. Every company, investor, and bank that screens new and existing investments for climate risk is simply being pragmatic.

Though UN Secretary General Ban Ki-Moon did not explicitly name divestment, he pointed to financiers’ responsibility to move their money away from fossil fuel assets and take the lead in creating the low-carbon economy:

We need in particular to win over institutional investors that collectively manage more than 70 trillion Euros of assets. The bulk of these investments are high-carbon assets. These investors have the power – and I believe the responsibility — to help transform the global economy.

Organisation of Economic Cooperation and Development (OECD) head Angel Gurria kept the drum beating by pressing nations to work towards ‘zero emissions’ by 2050.

To achieve zero emissions, Gurria urged nations to put a price on carbon, reform fossil fuel subsidies, and address inconsistent energy policies that send mixed signals on climate action.

We are on a collision course with nature. Now is the time for us to take bold decisions. Cherry-picking a few easy measures will not do the trick.

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