Tomorrow's Economy Taking the pulse on the green transformation: Healthy or Manic?
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Centre for Sustainability & Energy
Tomorrow’s Economy
Taking the pulse on the green transformation: Healthy or Manic?
Per Espen Stoknes
estoknes
MIT Press, 2021
EU climate attitudes
90%
Sweden
Germany
80% EU27
Finland
“How serious a
problem do you 70% Netherl
think global
warming / climate
change is at this 60%
moment, on 1-10?”
50%
% saying very serious 7-10
2008 2009 2011 2013 2015 2017 2019
4
Per Espen Stoknes, BI Source: Eurobarometer, eldwork April 2019
fi
2019: “Brutal news” & climate strikes Per Espen Stoknes, BI https://www.theguardian.com/environment/2018/dec/05/brutal-news-global-carbon-emissions-jump-to-all-time-high-in-2018 5
“ecosystems are collapsing and Per Espen Stoknes, BI 6
6
5
Resource-productivity,
renewables & circular
Internet & ows
4 biotech
3
TV, aviation
2 computers
Electricity
cars &
chemicals
& rail
fl
What is green growth?
rp > g
$
= increase of economic activities
that give lower total
environmental impact Tons
Resource
Growth
productivity
rp < g
“Grey growth” is productivity
$
increase where total environmental
Tons
impact (footprint) grows in spite of
Resource
Growth
higher efficiency productivity
Per Espen Stoknes, BI Source: Stoknes & Rockström, 2018, Redefining green growth
The green growth compass
+10%
(% change in GDP / year)
Green growth Grey growth
-10% Change in Ecological Footprint
-10% (% change in EF/year) +10%
Economic Growrth
Green degrowth Grey degrowth
-10%
Per Espen Stoknes, BI Source: Stoknes & Rockström, 2018, Redefining green growth“Investors are increasingly…
recognising that climate risk
is investment risk.”
Larry Fink, CEO BlackRock
(9.000 bn$)
https://www.blackrock.com/corporate/investor-relations/larry-fink-ceo-letterAre sustainable companies more profitable?
No
8%
"it depends"
29 %
2200 research
studies show:
Yes
63 %
“Meta review” - i.e. a review of the previous 60 reviews.
Conclusion: “Roughly 90% of studies nd a non-negative ESG-CFP relation”
Sources:Friede, G., Busch, T., & Bassen, A. (2015). “ESG and financial performance: aggregated evidence” Journal of Sustainable Finance & Investment
fiIs it profitable - in general?
Det lønnershare
European segprice
å investere bærekraftig
performance by Environment,
social governance (ESG) rating
European share price performance by ESG rating
125 Index = 2012
50% difference
115
e bærekraftig
by ESG rating AAA
105
AA
50% difference
50%
A
BBB
95 Difference
BB
B & CCC
AAA
85
AA
A
BBB
BB 75
B & CCC 2012 2013 2014 2015 2016 2017 2018
Kilde: MSCI, Nordea Markets
9 TOGETHER WITH CUSTOMERS AND PARTNERS NORDEA ENABLES THE
Source: MSCI, Nordea Markets(2018)Are green growth companies profitable?
14
Source: EIP, https://eipclimateindex.com/?page_id=6Green Growth
Investments in ESG
take off
Per Espen Stoknes, BI https://www.morningstar.com/articles/1019195/a-broken-record- ows-for-us-sustainable-funds-again-reach-new-heights 15
flIs it pro table - in
Is it profitable - in general?
European share price performance by Environment,
general?
social governance (ESG) rating
maturity
Techno-
economic
synergy
paradigm
shifts turning
chaos
eruption
Source: Carlota Perez (2003). Technological Revolutions and Financial Capital 16
fiWhy a green wave now? 7 deep drivers:
1. Renewables cost-curves
2. ESG is suddenly for real
3. Material ows go digital and circular
4. Financial Climate Risk
5. SDG & Paris agreement is humanity’s rst common plan
6. “G3” goes green, net-zero circular + EU taxonomy
7. Covid-19 has resurrected the active government
Photo credit: © Trent Slater Source: Stoknes (2021) Tomorrow’s economy 17
fl
fiConclusions
1. Problem: Resource wastefulness
2. New wave: Shift in innovation from
labor to resource productivity
3. Pro table: Green is the new black!
4. The sixth wave: A deep, accelerating
shift, but the timing is unknown
18
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