In addition to the core curriculum (Foundations in Wealth Management, Investment Planning, Tax Planning, Retirement Planning and Insurance, Estate Planning), Columbia University’s Master’s of Wealth Management includes other groundbreaking courses to train the next generation of wealth advisors. The Special Topics in Wealth Management: Disruptive Trends course includes a discussion on ESG.
Berit Suba teaches Retirement Planning in Columbia University’s Master’s in Wealth Management program. She was part of the inaugural class to receive her Chartered SRI Counselor™ credential to better help investors understand ESG factors. Berit is a practicing financial advisor who received her MBA from Columbia University and holds the CFP®.
Climate Week NYC kicked off September 20 with calls for action from the investment community, governments, companies, and consumers alike. Among the goals is to attain “Net Zero” by 2050 to curb emissions and mitigate the potential catastrophic impact from warming and climate change.
Net Zero is reaching a balance between the greenhouse gases produced and the amount removed from the atmosphere. We achieve net zero when the amount we add is no more than the amount taken away. Investors, individuals, companies and countries, all agree that tackling climate change is crucial. According to the World Meteorological Organization, 20 of the hottest years worldwide have taken place within the last 22 years. Average global temperatures have risen to 1○C above the pre-industrial era.
Although one degree may seem inconsequential, it is already having detrimental consequences. More frequent and intense droughts, fires, storms, heat waves, rising sea levels, melting glaciers, and warming oceans are directly harming animals and their habitats. Moreover, climate change can negatively alter people’s communities and livelihoods. Taxing outdoor work in the heat, increased allergies, and other health risks are occurring. This will only be compounded if water quality suffers. Financially, we’re seeing more expensive food from reduced agricultural yields, home damage costs, more expensive insurance, and higher electric bills and outage costs from more blackouts.
It may benefit advisors and investors to learn more about sustainable investment strategies. As companies incorporate more sustainable best practices, investors, the planet, and all of its occupants will benefit.
If recent trends continue, there are predictions of global temperatures increasing by as much as 3-5○C by 2100. Scientists and governments attribute the change in climate to higher levels of greenhouse gases in the atmosphere. The most common greenhouse gases are water vapor, carbon dioxide, and methane.
Carbon dioxide is the most abundant and harmful greenhouse gas. As such, reducing carbon emissions, carbon footprints and finding low-carbon alternative energy sources are ways to tackle climate change. The excess of greenhouse gases in the atmosphere is activating global warming. Reducing the amount of these damaging gases should aid in confronting climate change. Greenhouse gas emissions can be reduced by using renewables and other climate-friendly energy resources. Examples include rooftop solar panels, wind generation, solar water heating, fuel cells powered by natural gas or renewable hydrogen, and geothermal energy. Emissions can also be lowered from activities such as power generation, industrial processes, transport and intensive agriculture. At home, we can reduce emissions through driving efficiently, carpooling, using less home energy and causing less waste.
S&P Global ESG (Environmental, Social and Governance) scores are now available on 9,200 companies, representing 95% of global market capitalization. Among S&P 500 companies, 90% publish corporate social responsibility (CSR) reports, up from 20% in 2011 (Source: BoA Securities). It may benefit advisors and investors to learn more about sustainable investment strategies. As companies incorporate more sustainable best practices, investors, the planet, and all of its occupants will benefit.