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Publisher's note
Toby is the CEO and co-founder of Corporate Knights Inc. and publisher of Corporate Knights Magazine. He spearheaded the first global ranking of the world’s 100 most sustainable corporations in 2005, and in 2007 coined the term “clean capitalism.”

Defending divestment

By Bob Litterman and Toby A.A. Heaps
The intersection of fiduciary duty and climate change.

Many investors today are trying to understand what climate change implies for their portfolios. Does market efficiency indicate they should hold market cap weighted indexes, or do expected impacts on valuations suggest another course of action?

Meanwhile, stakeholders are raising questions and putting pressure on asset owners. Some are motivated by concerns about ethical issues and consistency with mission; others are purely focused on risk and expected returns.

There is clearly a moral issue to consider in owning a public company that, for example, spreads misinformation and otherwise deliberately impedes public policy for private gain, but how far does that moral concern spread? Only a few institutions, such as the Rockefeller Brothers Fund, have announced divestment from all fossil fuels on moral grounds.

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Being okay with enough

By Toby A.A. Heaps
By mindfully appreciating the little we need, perhaps we can let go of the insatiable wants leading us astray

True story, Word of Honor:

Joseph Heller, an important and funny writer

now dead,

and I were at a party given by a billionaire

on Shelter Island.

I said, "Joe, how does it make you feel

to know that our host only yesterday

may have made more money

than your novel Catch-22

has earned in its entire history?"

And Joe said, "I've got something he can never have."

And I said, "What on earth could that be, Joe?"

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The Third Industrial Revolution is upon us

Visionary economist Jeremy Rifkin argues that those who don’t adapt will be left behind.

Jeremy Rifkin has been a well-known economist, social theorist and author for decades, weighing in on the impact of scientific and technological changes on the economy, the workforce, society and the environment.

Rifkin’s last several books have argued that a new convergence of energy, communication and transportation networks along with the onset of internet technology and advances in renewable energies, are creating a powerful new infrastructure that is propelling forward a Third Industrial Revolution.

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Cows, coal and cars

Three weird tricks for solving climate change.

Cows, coal and cars. Together they account for roughly half of all human-caused greenhouse gases. To solve global warming, the world need only ban beef, belching cars and coal power plants – and we’re close to halfway there. It’s not as crazy as it sounds. In fact, if we weave together policies from Odisha, Oslo and Ontario, we discover a pretty robust blueprint to a cooler planet.

 

‘Don’t have a cow’

While Indian Prime Minister Narendra Modi did not quote Bart Simpson in his plenary speech at the recent Paris climate summit, India’s states have unintentionally pioneered a vital policy for reining in global warming pollution. In India, where cows are sacred according to Hindu beliefs, Odisha and 23 of the country’s other 28 states have banned beef (punishable by up to five years in prison if you are caught eating a hamburger in Mumbai, for example). Given that beef accounts for 40 per cent of global livestock emissions, which in turn account for one-sixth of human-caused greenhouse gas emissions, we all have a cow in the fight against climate change. As the growing global middle class syncs up with a Big Mac food culture, taking a page from India’s states – minus the Hindu nationalist undertones and communal violence – would be a big step away from the cliff of dangerous global warming. And that’s no bull.

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What kind of world do you want to invest in?

New tool analyzing Gates Foundation, Wellcome Trust, ABP, CPPIB & others shows high costs of not divesting from fossil fuels.

Global banking firm UBS is currently running an ad campaign that asks: “Do I invest in the world I am in? Or the one I want?” This question has never been more pertinent as we come to grips with the climate reality on the eve of the Paris climate talks.

In our market society, investors have immense power to shape norms and political culture on questions of economic importance.

To date, the conventional wisdom has been that investing to foster a world that accelerates the shift from old fossil fuel energy to new clean energy is a well intentioned, but bad idea if you care about financial returns.

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