2017 Trump Presidency Cause for Celebration-Tipping Point towards Fuel Free Energy and Value(s) Investing

As the year comes to an end,  we normally take stock and think encouraging thoughts for the future. I feel extremely upbeat, in spite of hardships, refugee crisis, elections, referendums, heros dying, Syrian War, corporate governance abuses, financial challenges, and more.

Who would have thought that Donald Trump would become President of the United States. Well, in spite of losing the popular vote by nearly 3 million, he is. Among my immediate and intermediate network, many were upset, angry, and concerned that the progress that had been made on climate change,  would end. In addition, we would lose all the momentum that COP 21 set in motion. Fossil intensive investments would gain the uperhand. I don’t share that concern. In fact, maybe this is the ultimate stress test that a carbon free economy needs. The USA has a President and his team, and a great deal of Congressmen and Senators, that are climate deniers. The government seems controlled by those in the camp of fossil intensive industries. If we can survive that, then the system has turned the corner. I believe we have. Just look at the figures, even if Donald and Fox News say otherwise.

Coal companies have gone bankrupt (Peabody) or loss most of their share price, on lack of demand and low prices. Oil prices are at historic lows. If demand keeps going down for fossil fuels, how will increasing drilling and mining help the matter. That train has left the station. If we look at the state of fuel free energy systems, we can only see massive success that can’t be turned back, as that would fly in the face of economics. Trump’s team does seem to have some expertise in making money and should be able to do the math.

2016 has been a year of record low prices for low-carbon technologies. In August, a solar PV project in Chile set a new low price of 2.9c/kWh. The following month, a record low was set for offshore wind in Danish waters of approximately 6.4c/kWh. The third record to fall is that of battery storage courtesy of Tesla’s Powerwall 2 that was announced in November. The Powerwall 2 is nearly half the installed cost per kWh of its predecessor with an inverter built in, making it “the cheapest lithium battery for the home ever made”, according to Bloomberg New Energy Finance (BNEF). To make matters all the more impressive, BNEF announced this year that 2015 saw record levels of investment into renewables and record installed capacity.

Bloomberg New Energy Finance, 2016

How electric cars will cause further oil collapse?

Investment Agreements

The Montreal Pledge is the first agreement of investors that require full transparency of their carbon risk and exposure. You can imagine that very few have signed, as this is not an aspirational statement like most of the international ESG agreements, but a true commitment to de-carbonization. “By signing the Montréal Carbon Pledge, investors commit to measure and publicly disclose the carbon footprint of their investment portfolios on an annual basis.”

Want to know who has signed and who hasn’t?

Podcast on Corporate Governance-Wells Fargo Bad Form

Great podcast on how Wells Fargo forced its sales teams to force customers to buy products they didn’t want, which led to fraudulent practices. Unfortunately, the employees took a great deal of the fallout.

https://audioboom.com/posts/5221026-732-bad-form-wells-fargo

TBLI VIP Dinners

In 2016, TBLI organised 4 VIP dinners and they were a huge success. The last two we held Dec 6&7, were sold out. In 2017,  TBLI will be organising private dinners in various locations during international ESG & Impact Conferences,  for a small group of thought leaders (25). The goal is to support each other in our ambition of scaling up Impact Investing.

Speaking Engagement:

Responsible Investment 2017 Copenhagen March 2, 2017

Books:

Journal of Cleaner Production

TBLI Foundation

Support TBLI’s work on building capacity and educating asset owners and managers about liquid and illiquid investments in Sustainability (ESG and Impact Investing). Make a Donation to TBLI Foundation.

Closing Remarks

I want to particularly thank my immediate family. They have been a great source of strength, inspiration, and sometimes less so. One thing, for sure, they are never boring. Rieki, Sam and Silas. May all your aspirations come true. Let’s keep laughing.

Arthur stay well and hope to see you more frequently in 2017.

To my 90 year old mother in NY. As we say in Brooklyn ‘Ma. Ya did good.” Thanks.

As a sign of defiance in a world of injustice, let us all confront Chat and Cutters, and other abuses, as Larry David does so brilliantly.

TBLI Hero

My wife and I recently caught up with my dear friend, Prakash Sethi, and his wife, Hillary. Prof. Prakash Sethi is one of the leading authorities on corporate codes of conduct. He is a distinguished Professor at Baruch College and is Forrest Mars, Sr., Visiting Chair Professor of Ethics, Politics and Economics at Yale. Prakash has written 29 books. Yes. that is not a typo. 29 books. I often found that mind boggling as I struggle with my own book. He is a great champion of ethics, values and good governance. As a thought leader, he was often asked to do social audits or evaluations of companies that were having reputation problems, like mining companies. His answer was always the same: “Happy to come help, but whatever we find, our results must be put into public domain”.

During dinner, I asked him how he keeps up his drive and energy to keep fighting the good fight with all its difficulties and all the challenges that he faces,in changing the corporate mindset. He said, “I love what I do and it needs to be done”. His thinking is clear and focussed, like his responses to values-related questions. I remember his response when I asked why he teaches at Baruch College and not at the Ivy League Colleges, full time. His response was “I believe in public education”.

Prakash’s classiness has been manifested over and over again. November 2-4, 2006, TBLI was held in Frankfurt. In preparation of that event, we were attacked by a right wing, Tea Party, Fox News-type who tried to torpedo our TBLI CONFERENCE. One of the speakers, we invited, Max Keiser, insulted and embarrassed a speaker that we wanted to invite, named Steve Milloy. Steve had started an anti SRI fund or “vice fund”. I thought it would be good to engage and have a dialogue about Steve’s fund and strategy. Steve tried to have Max removed from the program by intimidating me,  all the American speakers, sponsors and the moderator of that session, Prakash Sethi. To my amazement, Prakask took a great deal of  time to listen and to try to understand Steve, who could easily be the poster boy for Fox News. After listening, Prakash decided that he would still moderate the session with Max Keiser. Steve then intimidated the dean of Baruch College,  and started a campaign to discredit Prakash and have him fired. In spite of all that, Prakash still came to Frankfurt and did a brilliant job in moderating the session, and not allowing bullies to dictate his behaviour. Where most would have ran for cover and take the easy way out, Prakash reflected and let values be his compass, and continued to show respect to someone who didn’t deserve respect. I was very impressed.

In a world where everyone seems to chase the short cut, the quick buck, the predator method, it is inspiring to see someone still working at the coal face with a smile on his face and joy in his heart.

Prakash, we love you.

Integrity has no need of rules.

– Albert Camus

Hope to see you and other ESG and Impact integrity leaders in Zurich, November 19-20.

Robert

Transparency

Recently, I was looking for a new service provider. Iris found a large list of potential web application companies that would meet our needs. What struck me was that most of them were not transparent about their pricing. Most didn’t publish any pricing at all. The vast majority had a link to a demo which would lead to a sales pitch and then possibly a price. Some called me immediately. When I asked for the price and not a demo, I got the sales pitch “this is not a sales pitch, blah, blah.” Few would tell me what was the cost. One did say what the price was, but he made it clear that was not the price. It seems any price was possible. I felt like I landed in “used car land”.

Whatever happened to just being transparent? I see the same pattern among events organisers. Many don’t publish the sponsor rates, what are the sponsor benefits, what is the program, who is attending, and more.

Is there a problem being transparent? Is being non-transparent the new norm, inspite of the global fish bowl that the internet offers and sustainability demands.

Mohamed ElBaradei has a beautiful quote: “If you have nothing to hide, there is no reason not to be transparent”

Support TBLI!

Reports and Podcasts

Check out this Plane Money Podcast: The Indicator Strikes Back episode

“By 2050, the business opportunities for sustainability-focused companies are expected to be between $3 trillion and $10 trillion annually, or up to 4.5 percent of global GDP” Morgan Stanley Institute for Sustainable Investing:

Goldman Sachs and the Wall Street Conman

I was reading the New York Times and came across this article with the following headline:
Wall St. Helped Greece to Mask Debt Fueling Europe’s Crisis

Surprise is not the appropriate word. My only question is why do institutional investors continue to work with an organization that continues to sabotage the financial system for its own person greed. Where are all the pension funds that signed the PRI and claim to work towards a more values based finance system:
Here are the principles:
1 We will incorporate ESG issues into investment analysis and decision-making processes.
2 We will be active owners and incorporate ESG issues into our ownership policies and practices.
3 We will seek appropriate disclosure on ESG issues by the entities in which we invest.
4 We will promote acceptance and implementation of the Principles within the investment industry.
5 We will work together to enhance our effectiveness in implementing the Principles
6 We will each report on our activities and progress towards implementing the Principles.

Where is the outrage and disgust? If you look at a recent study done on mba’s, the shock is even greater.
“The bank’s reputation remains strong among aspiring MBAs. It was ranked the fourth-most-desirable place to work in a survey of 6,207 MBA candidates at 67 business schools from December 2008 through March 2009 by Universum Group, a Stockholm-based marketing company. Goldman Sachs, which was rated third the previous five years, trailed No. 1 Google Inc., based in Mountain View, California, and the consulting firms McKinsey & Co., in New York, and Bain & Co., in Boston.
Unflagging Interest

Goldman Sachs hasn’t seen any decline in job inquiries from MBA students since last year, Sandra Hurse, vice president for global recruiting, wrote in an e-mail.

“Our applications numbers remain on par with previous years, and attendance at our recruiting events on campus this year were high,” Hurse said.

I guess dying rich in any way possible is still the mantra. However, I do believe that what Dow Chemical, experienced during the Vietnam War and what Shell experience with Nigeria and Brent Spar with respect to reputation will happen to Goldman Sachs. Perhaps, it will take longer, but in the long run, we need a finance system based upon values and less on macho ego. If not, the same melt down will happen over and over again.
We are already starting to see large institutional investors (pension funds, family offices, etc.) do their own financial engineering. It’s not rocket science, and many of the so called whiz kids on wall street, are not that smart. Recently, a large investment bank approached me for an introduction to a $ 100 billion low carbon infrastructure project. I tried to facilitate, but my friend (the client) said that the balance sheet of the investment banker was not strong enough for them. I referred this information to the investment bank, and they said in a pathetic attempt to boost up their ego “Oh. That is debt. We only do M&A”. It was hysterical and sickening to listen to this garbage.
“Dude you cut and paste text to be in compliance. You are not curing cancer and providing education, food, and water to billions of poor people”. Our standards for financial service industry providers need to be higher. There are many companies to choose. Whatever happened to the client is king.
I guess they never worked with Wall Street Investment Bankers.