- Director of Climate Research
Skip to main content
- Funds
- Insights
- Capabilities
- About Us
- My Account
The views expressed are those of the author at the time of writing. Other teams may hold different views and make different investment decisions. The value of your investment may become worth more or less than at the time of original investment. While any third-party data used is considered reliable, its accuracy is not guaranteed.
In February, the Intergovernmental Panel on Climate Change (IPCC), a body of the United Nations, released its Sixth Assessment Report, “Impacts, Adaptation and Vulnerability.” While the full report is 3,675 page long, the Technical Summary is just 96 pages and well worth the read. In the Summary alone, climate adaptation is referenced 442 times, versus 60 for climate mitigation.
It’s clear to me that the IPCC is urging the world to both prepare for and spend more money on adapting to climate change. The report authors write, “Increasing adaptation is being observed in natural and human systems (very high confidence), yet the majority of climate risk management and adaptation currently being planned and implemented is incremental (high confidence).”
Other heavily covered topics in the report include biodiversity, food and water stability, health and disease, and the inequity of climate change. From the report, “Effective ecosystem conservation on approximately 30% to 50% of Earth’s land, freshwater, and ocean areas, including all remaining areas with a high degree of naturalness and ecosystem integrity, will help protect biodiversity, build ecosystem resilience and ensure essential ecosystem services (high confidence). Currently, roughly half of the world’s population are experiencing severe water scarcity for at least one month per year due to climatic and other factors (medium confidence).”
Given the frequent mentions of health and disease as climate-related concerns, it strikes me that the IPCC sees the COVID-19 pandemic as a lesson in how to move climate change into the everyday psyche by associating it very clearly with individual, personal risk. Clearly, however, the risks are unequally distributed. The IPCC emphasizes the range of human vulnerability and the importance of addressing climate change as part of the UN Sustainability Development Goals. Through our research with Woodwell Climate Research Center, we have also learned that climate change is not an equal foe but a bully that disproportionately picks on lower-income and otherwise more vulnerable populations.
Agency is key and, in my mind, must be more widely shared. Less vulnerable countries, including the US, have fewer reasons to act aggressively on climate change. This is unfortunate and short-sighted. While self-interest may trump global interest in the short run, in the long run, I believe people will recognize climate change as a shared challenge. Even if you were isolationist or thought in purely economic terms, it is difficult to ignore the connections: When a semiconductor supplier in Taiwan shutters its production for three months because of a local drought, that company’s climate problem quickly becomes the supply-chain problem for an automobile manufacturer in another part of the world.
Finally, the effects of climate change will be increasingly apparent (and tragic) on both a humanitarian and geopolitical risk level, with national security issues like military climate resiliency, water conflicts, and climate migration top of mind. We’ve just witnessed a global response to both a public health crisis and a war. Perhaps the world will also learn the importance of global coordination on climate change.
Learn more about how Wellington manages climate-related risks and opportunities, engages with companies on climate change, and reduces our own carbon footprint.
Chart in Focus: What does the rate cut mean for equities and bonds?
Continue readingURL References
Related Insights
Stay up to date with the latest market insights and our point of view.
Monthly Asset Allocation Outlook
How to evolve your portfolio for the latest market conditions? Explore the latest monthly snapshot of our Multi-Asset Team’s asset class views.
Sahm rules are meant to be broken
Fed easing is finally here and fundamentals remain favorable. But what about that election? Members of our Investment Strategy & Solutions Group offer their outlook, including their latest views on equities, bonds, and commodities.
What’s next after Iran’s missile attack on Israel?
Geopolitical Strategist Thomas Mucha shares his analysis of the latest escalation in the Middle East conflict, including his thoughts on a wider regional war and the market implications.
Unearthing the unseen in geopolitics
Unearthing the unseen in geopolitics. Watch Geopolitical Strategist Thomas Mucha delve into the investment impact of structural geopolitical shifts and share his latest take on the upcoming US election.
Chart in Focus: What does the rate cut mean for equities and bonds?
Are rate cuts positive? On the heels of the much-anticipated initial Fed cut, in this article we look to historic precedent for where the markets could go in the coming months.
An active investor’s guide to growth equities
Our experts offer their view on the current economic environment, explore best practices for investing in high-quality growth equities, and highlight where they see opportunity now.
Chart in Focus: The need to differentiate market growth from macro growth
Macro growth and earnings growth have been misaligned for the last 15 years, particularly in the US and China, but in opposite directions. For equity investors, what would be the key to identify real growth?
Monthly Market Review — August 2024
A monthly update on equity, fixed income, currency, and commodity markets.
Rate relief: Fed cuts half point, but says “economy is strong”
Our expert explains the Fed's bold rate cut and some key takeaways for investors.
The real issue on rate cuts? Keep your eyes on the dot (plot)
Keep your eyes on the Fed's 2025 dot plot. The real story is where policy rates are headed, not just the next rate cut.
Disappearing unicorns: The importance of capital efficiency in a higher-for-longer rate environment
Members of our late-state growth equity team share their views on the impact of interest rates on venture capital activity — including the ability of companies to reach “unicorns” status.
URL References
Related Insights
Monthly Market Review — August 2024
Continue readingBy
Brett Hinds
Jameson Dunn