The global financial turmoil brings with it many exciting opportunities. These will be found as investment shifts away from the traditional short-term focussed, often environmentally degrading options towards longer-term, more intelligent and natural capital conserving initiatives, such as renewable energy and clean technology development.

Research also predicts a massive increase in demand for green collar jobs, in many different sectors, from carbon traders, sustainability managers to green plumbers and even those involved in the more polluting industries¹.

UN backed investment
The UN are calling for a massive redirection of investment as part of the New Green Deal they have developed, aimed at generating businesses and jobs in renewable energy, clean technology, sustainable agriculture and conservation and better management of the Earth’s natural capital. According to the United Nations Environment Program’s (UNEP) executive director Achim Steiner “the 20th century economy, now in such a crisis, was driven by financial capital. The 21st century one is going to have to be based on developing the world’s natural capital to provide the lasting jobs and wealth that are needed, particularly for the poorest people on the planet”².

It seems now is the time to invest in renewable energy and clean technology, with their potentially lower risk profile, than the investment that fuelled the current economic climate. Such investments have the added benefit of helping drive the fight against climate change. For a long time opponents of renewable and clean technology have argued that these alternatives are expensive, especially when compared to the relative cheap cost of using fossil fuels.

Now, organisations with carbon intensive portfolios face increased risks as the economy moves towards a low carbon future. The introduction of the government’s Carbon Pollution Reduction Scheme, scheduled for 2010, means big polluters will have to factor in a new cost, the cost of carbon. With this in mind investment trends are likely to shift away from the higher risk, carbon intensive ventures towards more sustainable and environmentally friendly options.  

Financial rewards of fighting climate change
The latest figures from HSBC suggest an investment shift is already underway. The annual revenues of companies producing goods and services aimed at fighting the effects of climate change topped $300 billion last year³, a figure equating to more than that generated by the biotech and software sectors combined⁴. Kevin Bourne, managing director of HSBC’s Global Banking and Markets unit says “climate change is set to be one of the defining investment opportunities in the years ahead... (and) is no longer an environmental or social issue, but a huge economic global opportunity”⁵.

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