Sustainability 360: investing in nature

2022 was an exceptional year for many reasons. As the Global North began to open up and recover from the pandemic, much of the Global South remains in various stages of lockdowns and immunisation. Find out more about the recent trends in our annual Sustainability report.

Phoebe Stone

The unfolding of war on the European continent, between Russia and Ukraine, has set us back further in our progress towards the United Nations Sustainable Development Goals and has created uncertainty and difficulty for investors to navigate. As a result of the inflationary economic environment, investments moved out of growth-oriented businesses and into more economically cyclical sectors, which are less synonymous with the long-term green trends.

To us, this has simply strengthened the case for sustainable investing. The trends we have been seeing in recent years have not changed: greenhouse gas emissions have continued to rise as a result of the Russian energy crisis, the cost-of-living crisis is pushing more people into poverty, and the natural world continues to deteriorate.

These challenges present huge opportunities. 

Three of the world’s largest economies have committed upwards of USD 500 billion to clean, safe and affordable energy by March of 2022.1 Europe unveiled “REPOWER EU” this year, part of its strategy to wean EU countries off Russian gas, the United States agreed the landmark Inflation Reduction Act targeting the solar industry and electric vehicles, and China invested USD 58bn in wind projects and USD 41bn in solar in the first half of 2022 alone. 

As we progress through 2023, our excitement around the solutions to climate change grows. Over 4,000 issuers have now committed to net zero by 2050 using the Science Based Targets Initiative framework, covering 38% of market cap, and are already implementing policies and practices to build resilience against the effects of climate change. At both COP27 in Egypt and COP15 in Canada, we saw investors prioritise nature and biodiversity as a key to solving climate change. We have also seen regulators hone in on issues around greenwashing through the FCA’s proposed sustainable financial regulation, as well as whispers of a UK green taxonomy to continue to enable shifts in capital to the transition. Read more in the report below.

Sustainability 360 2023 - Fourth edition


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