A framework for sustainability conversations, investing in nature as our actual economic engine—Part 2/3

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Table of content

1. Preamble
2. Introduction: “People calculate too much and think too little.”—Charles T. Munger
3. A framework for sustainability conversations, investing in nature as our actual economic engine—Part 2/3
4. Endnote: "The net to zero transition is for and about people"
5. Our world in data: Greenhouse Gas Emissions
6. Weekly highlights: your comments and testimonials, resources, insights, visualization, and podcast
7. Nevelab Technologies Partner Program

This article is part of the “The Road to Sustainability?” weekly review on Linkedin. It is now followed by 16,100+ subscribers and counting, including Fortune Global 500 companies, from all industries and sectors, governmental and non-governmental agencies, VCs, fast-growing startups, and entrepreneurs from all around the globe.

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1. Preamble

This review is the second part of a three-part series dedicated to defining a framework for sustainability conversations. The series?is intended to provide decision-makers, policymakers, investors with an understanding of how to catalyze technological transformation, adopt the necessary tools, and deploy policy solutions geared to the world's challenges.

• Sustainability and efficiency change can seem like major issues that are either too far down the road or too big to solve. But we know the primary sources of the majority of today’s challenges.?A framework for sustainability conversations,?understand and define—[Please read Part 1 here ].
• A more sustainable economy requires heavy investment—A framework for sustainability conversations,?investing in nature as our actual economic engine—[This week's review, Part 2].
• Getting to net-zero emissions in the next thirty years may be the most challenging task humanity has ever attempted.—A framework for sustainability conversations,?corporate action, private-sector solutions—[Next week's review, Part 3]

At?Nevelab Technologies ,?we support cutting-edge research, development, and demonstration (RD&D), which is key to achieving accelerated innovation and helping the private sector support economic growth, drive down costs for key technologies, and promote corporate leadership assessment sustainability and efficiency.

I hope this effort answers the many questions I get about helping?organizations embrace sustainability principles?and become more future-proof.?Please give?me feedback ???Subscribe ???Ask me a question ???Become a partner .

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2. Introduction

“People calculate too much and think too little.”—Charles T. Munger

Institutional voids characterize emerging markets. To survive and thrive over time, large firms operating in these markets must respond to uncertainty―predictable global challenges, political instability, violence, macroeconomic fluctuations, and crises―without the benefit of specialized intermediaries that can analyze market information, facilitate transactions and provide credibility signals. Yet, the global environment is unquestionably vulnerable, but the corporate community's pledges to improve it appear to be. Access to low-cost capital finance is crucial for many low-emissions technologies to compete mainly with fossil fuel-based energy.

We can add the fact that despite disparities between developed and emerging economies, globalization continues deflationary. The pandemic has had little effect on the fact that the world's population is still aging, the influence of technological advancements, or global competitiveness. Furthermore, a more flexible monetary policy should contribute to this upbeat view.?

Here's the second part of our?simplified?framework?in three parts for approaching any conversation about sustainability to help address some of the vital issues discussed during an investment presentation or chatting with a friend.

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3. A framework for sustainability conversations, investing in nature as our actual economic engine—Part 2/3

3.1—Climate-related investment is severely underfunded, especially given the requirement to achieve net-zero emissions by 2050.

As inflation rises, supported by robust labor markets, economic parameters alter, requiring central banks to adopt a different approach. Thus, it seems reasonable to set new strategies that profit from asset investment allocations.

Massive improvements in the efficiency of technologies and energy-save devices have facilitated continuing reductions in the quantity of energy required to produce a unit of goods and services in industrialized economies. Yet, for many low-emissions technologies, access to low-cost capital financing is critical to competing with fossil fuel-based energy at scale.

Moreover, considering that the central bank raised the eurozone's GDP projection for 2021 to 4.6 percent, up from 4.0 percent, as global recovery accelerates, and reassured investors that the optimistic outlook does not affect the central bank's resolve to expand asset purchases.?

As we believe that the current main threat comes from the labor market, the dilemma is whether the overlapping variables of supply shortages, rising demand, and greater purchasing power are transitory or long-term. This is dependent on the influence of ‘base effects,' or the mechanical increase in inflation caused by economies reopening following last year's record price reduction.?

In principle, all countries have the same supply- and demand-side possibilities. Nonetheless, specific alternatives, particularly those in the early phases of commercialization or requiring substantial initial financial expenditures or significant outside knowledge to run, are likely to face extra barriers to usage in emerging economies.

For the time being, the recovery primarily impacts those sectors of the economy that are re-awakening from forced shutdowns due to rising oil prices and supply chains that have yet to shake off their shortages. And as already mentioned many times, progress in tiny increments is insufficient due to the scale of human energy use. As a result, we will only invest in technologies that have the potential to decrease greenhouse gas emissions by at least half a gigaton per year, or roughly 1% of world emissions, on a large scale.

? In our three-part review series dedicated to insights on Natural Capital, from May 2021, we outlined some policies and measures to support affected environments and firms that will be essential for keeping the inequality gap from widening further. Please see the links in the resources section /1

3.2—COVID-19 increases inequality in emerging markets and developing economies

Overall, at least 1.6 billion people—one-fourth of the world's population—do not have access to electricity, and this figure has been stable in absolute terms since 1970. Despite this, the electricity necessary for individuals to read at night, pump a small amount of drinking water, and listen to radio broadcasts would account for less than 1% of total world energy consumption.

In this very tumultuous twenty-first century, developing and emerging economies confront a dual-energy challenge: meeting the requirements of billions of people who still lack access to essential, modern energy services while also engaging in a worldwide transition to clean, low-carbon energy systems. Consequently, past development rates toward improved efficiency, decarbonization, more fuel variety, and reduced pollutant emissions must be significantly accelerated to overcome such challenges.

For decades, global firms avoided emerging markets when they should have engaged with them more closely. And, just as COVID-19's work-from-home shock is pushing firms to reconsider corporate culture, so are they increasingly reconsidering how they will handle climate change.?

Fortunately, the goal of decreasing greenhouse gas emissions may be matched with other energy-related goals, such as increasing indigenous renewable resources and minimizing local forms of pollution. However, there will be conflicts in the near future.

Instead of putting the environment back on the agenda, the pandemic has created records for renewable energy installations, electric car sales, net-zero corporate pledges, and sustainable financing.

This highlights the growing worry about global climate change and the need for a dramatic overhaul of the world's energy-producing and energy-using infrastructure. There have been abundant studies written on sustainable energy, but few have tackled it, especially from the standpoint of a developing economy.?Please see the links in the resources section /2

4. Endnote

As mentioned in our previous reviews and that we will explore more in our next part, sustainable energy policies have a better chance of success if they also contribute to other societal and economic development goals. Therefore, governments should consider all strategies to promote beneficial synergies and avoid generating cost-cutting incentives. On their side, firms should more than ever invest in efforts to work with public-sector financing institutions that have been instrumental in scaling up new climate solutions.

It's critical to remember that not everyone who works in the fossil fuel business can easily transition to a renewable energy profession, so governments must push training and allocate resources to making new possibilities available. Citizens must be active participants throughout the whole process, making them feel that they are a part of the transformation rather than merely being subjected to it.

The net to zero transition is for and about people.

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5. Our world in data: Greenhouse Gas Emissions (GHG)

• The latest measurement of atmospheric CO2 ?(as of June 17, 2021): 418.24 ppm; May 2020: 416.00 ppm; 25 years ago: 360 ppm; 250 years ago, est: 250 ppm.
• Methane (CH4) is estimated to have a GWP of 28–36 over 100 years.?
• Nitrous Oxide (N2O) has a GWP 265–298 times that of CO2 for a 100-year timescale. N2O emitted today remains in the atmosphere for more than 100 years, on average.

? More?here .

? Please consider sharing these numbers with your community by forwarding this email or tweeting?this .

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6. Weekly highlights: insights and resources

6.1—Your comments and testimonials

• Comment by Yangbo Du on the 6/14/2021 : "Starting point regarding sustainability investment is to redirect investment in harmful activities (e.g., coal/gas-fired power, monocrop agriculture, automobile dependence) towards helpful activities (e.g., renewables, regenerative agriculture, shared and active mobility). If transition needs to occur at a quicker pace, we can consider trading spending against consensus-building:?https://pedestrianobservations.com/2019/07/08/climate-urgency / [...].

6.2—Resources

1. Learn more on?Introduction to Sustainability by The Road to Sustainability? ,?an animated presentation on YouTube.
2. Net Zero by 2050 - A Roadmap for the Global Energy Sector by IEA.

6.3—Visual of the week

6.4—Podcast: "We urgently need well-balanced economic systems"

I?had the great chance to share with one of the top female entrepreneurs in the impact and sustainability sectors,?Alessa Berg (Sollberger) .

We shared about creating new economic models to support climate change, the current diversity frictions. Alessa also expressed why it is essential to act collectively to address global challenges and how blockchain holds a necessary key to unlocking the door for a world well balanced.

Alessa is the founder and CEO of Top Tier Impact (TTI), the global ecosystem of impact and sustainability leaders. The TTI Group’s mission is to accelerate the mainstream adoption of impact and sustainability to make investments and running companies. It has an active private network of 500+ impact investors, entrepreneurs, and corporate leaders across more than 40 countries, an investment division, a climate risk & ESG consulting business, and a policy unit.?Alessa is a board member of several impact funds and companies.

? Please learn more about?Top Tier Impact .

The first podcast series is dedicated to diversity, inclusion, ethics, belonging, and wellbeing. Listen to The Road to Sustainability? Podcast on your favorite streamer?Anchor ?-?Apple Podcasts ?-?Breaker ?-?GooglePodcasts ?-?Spotify ?-?YouTube ?-?SoundCloud .

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??Please give?me feedback ???Subscribe ???Ask me a question .

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7. Nevelab Technologies Partner Program

With climate change causing investment risks and opportunities through structural changes in almost every sector of the global economy, we believe that any collaboration launched during such turbulent times must benefit from the latest research on sustainability investment to make the best possible corporate strategic decisions.

These collaborations will allow us to engage closely with universities, centers of innovation, and institutions to incorporate the most current knowledge about investments and sustainability, in addition to enabling pioneering research in the sustainability and efficiency areas.

? A world-class partner program that can help you deliver comprehensive sustainability and efficiency solutions and expertise. Become the trusted advisor for your customers:

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Information

???The IEEE Global Artificial Intelligence Systems (AIS) Well-being Initiative ?is an IEEE program whose purpose is to ensure every technologist is educated, trained, and empowered to prioritize ethical considerations in the design and development of autonomous and intelligent systems. The Initiative is global, open, and inclusive, welcoming all individuals or representatives of organizations dedicated to advancing technology for humanity. Please reach out to me directly to learn how to join the Global Artificial Intelligence Systems (AIS) Well-being Initiative team.

???The Road to Sustainability ?is a global network to build a more efficient, safe, and inclusive world. Sustainability is a fundamental part of every organization's culture, investment goals, and actions as a responsible business undergoing changes and being transferred between paradigm shifts.

???Nevelab Technologies ?is a purpose-driven platform that leverages artificial intelligence to provide organizations with the tools to integrate sustainable imperatives while generating actionable insights.

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Disclaimer

The Road to Sustainability? is an initiative by?Nevelab Technologies ?and is circulated for informational and educational purposes only.

Nevelab Technologies Research utilizes data and information from the public, private and internal sources, including data from actual Nevelab open data access. While we consider information from external sources reliable, we do not assume responsibility for its accuracy.

The views expressed herein are solely those of Nevelab Technologies as of this report's date and are subject to change without notice. Nevelab Technologies may have a significant financial interest in one or more of the positions and securities or derivatives discussed. Those responsible for preparing this report receive compensation based upon various factors, including, among other things, the quality of their work and firm revenues.