The writer, a former chief executive of HSBC, argues that individual shareholders should have direct votes on climate change. We are falling behind commitments to the long-term viability of the planet, and while every actor behaves rationally within constraints, the system as a whole is failing.
Governments are constrained by stretched public finances, making it no longer credible that the state can fund the transition at the required scale. Businesses and stewards of private capital must step up rather than preserve risk profiles while socialising transition costs.
Boards often assume shareholder support for backtracking on climate commitments, relying on top institutional investors and ESG-specialist fund managers who remain several steps removed from pension savers and tracker fund investors. The accountability chain is fractured at every link.
For an issue as fundamental as planetary health, this is no longer acceptable. The solution requires placing climate and nature above remuneration and treasury matters on the board agenda, and giving ultimate shareholders a direct voice in how their capital is stewarded.
Source: Financial Times Companies · Summarized by HeadlinesBriefing