Pictet Group
A world fit for life
Humanity has long taken the natural world for granted, benefiting from the plentiful resources that have enabled us to grow and excel unlike any other lifeform on this planet. Now, the evidence is clear and resounding: we are not apart from the natural world, but part of its delicate ecosystem.
We now find ourselves at a crossroads, one that presents us with a tremendous test. We can either continue on our current trajectory – one that may well lead to the end of humankind – or we can alter it to build a society in harmony with the world in which we live.
At the World Economic Forum 2023, Director of the Potsdam Institute for Climate Impact Research, Johan Rockstrom, gave a stark warning “scientifically this is not a climate crisis. We are now facing something deeper. Mass extinction… this is a planetary crisis”. Scientists like Professor Rockstrom, world leaders and non-governmental organisations across the globe have declared climate change and biodiversity loss as the single biggest threat facing humanity.
All philanthropy is meaningless unless we have a world fit for living in.
Yet in spite of the overwhelming evidence that humanity is unequivocally responsible1, combatting climate change is continuing to receive woefully inadequate investment. This includes of our philanthropic attention, with just 2%2 of global philanthropy being dedicated towards it. In Asia, the region most vulnerable to the adverse consequences of climate change, that figure is less than 1%3.
However, this landscape is changing rapidly and ever more philanthropists are addressing the asymmetry in their philanthropic portfolios or asking how they can do more. We are seeing this amongst our clients and are helping them transition towards a more balanced philanthropic approach, which assigns a more appropriate weight to climate issues.
The impacts of climate change are widespread, interconnected and intensifying at a rapid rate.
Scientists globally agree on the necessity to limit global warming to 1.5°C by the end of the century (versus pre-industrial levels 1850-1900). Failing to do so, we run the risks of triggering so-called “climate tipping points”, after which it becomes impossible to return to our original climate system.
USD15 trillion in alternative technologies between now and 2050 is required in order to meet the Paris Agreement goals [4].
So how can philanthropists address these issues? It can often seem daunting and too large a task to tackle, however as this issue is so intrinsically linked to every aspect of our lives, each action we take can have a positive impact. To start, it helps to think about the approaches in two key areas — adaptation and mitigation.
Mitigation : Actions taken to reduce greenhouse gas emissions and/or to remove these emissions from the atmosphere, in order to limit global warming to 1.5°C. This includes moving away from fossil fuels to renewable energy, halting deforestation and reforestation.
Adaptation : Actions taken to reduce, or adapt to, the adverse impacts of climate change – because some will occur even if we limit global warming to 1.5°C. Adaptation solutions are region- and context-specific and can include diversifying crops; ensuring communities can adapt to extreme weather, sea level rise and increased floods.
Mindful of these two categories of action, the following are four key areas philanthropists can consider when looking at how they can play an impactful role tackling climate change.
Without question, climate change is one of the greatest challenges humanity has ever faced. Though this may sound daunting, there is reason for hope - just as humans have created this planetary crisis, so too can we fix it. Whilst the constant flux of news around extreme weather events may make it seem like progress has been sluggish, much has been achieved in the last years.
However, so much more is possible if we continue to put our minds, resources, vision and political will towards building a more sustainable world.
Reasons for Hope
• Since 2018, renewable energy has accounted for 1/3 of global electricity capacity5 - and in 2020 82% of new global generating capacity came from renewables6. From 2012 to 2021, renewable energy capacity has grow 112%.
• In 2020, investments in green bonds reached a new global record of $270 billion7.
• In 2022, the European Union announced a deal to impose a carbon dioxide tariff on imports of polluting goods such as steel and cement, known as the "Carbon Border Adjustment Mechanism" (CBAM), which would enable more industries to be brought under its carbon cap & trade scheme.
• In 2022, the government of France signed into law a proposal by France’s Citizens’ Convention on Climate to ban flights between cities that are linked by a train journey of less than 2.5 hours.
• In 2020, the global electric car (EV) market exceeded ten million – double its number in 20188.
