It’s January 1st and it’s 16.2°C in London

As I was writing this post I received an alert on my Apple Watch telling me that it’s the warmest New Year’s Day on record, reaching a balmy 16.2°C in London.

Some of us might have a gut feel that today’s temperate is a statistical anomaly and not a sign of climate change. But using gut feel attitudes to dismiss something as complex as climate change is dangerous because gut feel on big topics is often wrong. It’s the same gut feel that led many to dismiss covid as “just another flu” that would soon blow over. The reality is that well over 5m people have died and the virus continues to disrupt societies even two years after its emergence.

Past personal experience and amateur gut feel is rarely a good basis for judging the future. Things change, sometimes dramatically and quickly. In fact, a 16.2°C New Year’s Day seems consistent with the warnings of scientists.

🇺🇳 Assessing the science

The IPCC is the Intergovernmental Panel on Climate Change and is the United Nations body responsible for assessing the science related to climate change.

Interestingly, the IPCC’s job is not to undertake research, but to examine the work of scientists and identify where there is consensus and where more work is required before conclusions can be safely drawn.

In May 2021 the IPCC’s work reached the position where they felt able to make three monumental conclusions:

1. “It is unequivocal that human influence has warmed the atmosphere, ocean and land. Widespread and rapid changes in the atmosphere, ocean, cryosphere and biosphere have occurred.”
2. “The scale of recent changes across the climate system as a whole and the present state of many aspects of the climate system are unprecedented over many centuries to many thousands of years.”
3. “Human-induced climate change is already affecting many weather and climate extremes in every region across the globe. Evidence of observed changes in extremes such as heatwaves, heavy precipitation, droughts, and tropical cyclones, and, in particular, their attribution to human influence, has strengthened since the Fifth Assessment Report (AR5).”

I’ve copied the IPCC’s exact words here because, unusually for a UN body, the language formulation is bold, decisive and with no wriggle-room for misunderstanding.

It strikes me as important that the IPCC has concluded there’s consensus across the scientific community on these points. Of course it’s possible to find dissenting voices, as it is with any subject, but those voices are both few and on the fringes. Unless you enjoy hanging out with conspiracy theorists or fringe politicians with an axe to grind, it’s hard to find support for an alternative view. In fact, it’s estimated that 97–98% of climate scientists support the IPCC’s conclusions. 97–98% is about as close to unanimity as it’s possible to get on any subject and is certainly good enough for me.

London’s balmy 16.2°C is, perhaps, not a statistical anomaly and instead just one of many signals that we should be taking seriously.

🧊 Getting real

Sometimes climate change talk comes across as a bit abstract and it’s easy to dismiss people like Greta Thunberg as alarmist. But rather than allow the complacent part of our brain to take over, let’s focus on an actual example and its impact.

One of those examples is Thwaites Glacier. This single glacier is losing about 50 billion tons of ice more than it is receiving in snowfall each year. Scientists are very concerned that its warming means that it’s on an accelerating path to breaking up — a process that, if completed, would result in a 65cm rise in global sea levels.

But Thwaites is only one of many such glaciers in the West Antarctic Ice Sheet, an area about the size of India. With concern that the breakup of Thwaits could accelerate further change, it’s referred to as “The Doomsday Glacier” for good reason.

But Antartic is still some distance from us. Let’s look at what this means for me, where I live: this projection is alarming. Probably in my lifetime, but certainly in my daughters, we’re looking at major disruption and significant areas of land flooding. Goodbye to most of our coastal towns, goodbye to Romney and hello to the new island of Thanet.

Oh, and there’s a nuclear power plant on that map, in one of the places we’re likely to ceed to the sea — I’m not sure how that will work out, given we know the combination of nuclear and flooding has poor outcomes.

We can care about the impact on the natural environment, or we can care about the economic problems that impact will bring. Either, or both, it seems to me are reasons to act.

🤷 Shifting opinion

I’ve spoken to a lot of people about climate change and run a few surveys on social media, trying to gauge opinions. I’m intrigued to understand how others view the subject.

It’s clear to me that opinions are shifting dramatically and quickly in favour of the need to address the issue. Almost nobody has told me they think climate change is untrue or a distraction. Virtually everyone I speak to expresses varying levels of concern.

Our culture is also changing. Conspicuous displays of CO2 generation, like driving a big gas-guzzling vehicle or large amounts of unnecessary air travel, are becoming socially unacceptable. Adopting green lifestyle changes is no longer laughed at, but now admired or at the very least looked on with interest. And it’s no longer considered eccentric to drive an electric car or to have a heat pump in our home.

As a result, mainstream political thought has also shifted. In Europe and the UK, at least, there’s support for climate policies across traditional left/right divides. We’re rapidly moving to a place where the only political debate is how to act, not if we should act.

However, I do think politics is far too slow to react to the full enormity of the change required. There’s a tendency to put off difficult choices for another day. We have ambitious targets for 2030 or 2050, but few practical steps actually funded or being implemented today. Politicians, it seems, would like to take credit for setting targets but not for the potentially disruptive change that’s needed to achieve those targets.

🌎 Taking a global and economic perspective

Of course climate change is a global topic. Some countries have an outsized impact, with China and the USA being far and away the biggest contributors to the issue.

But if we look at things on an individual and personal basis, examining how much CO2 the average person in each country generates, we get a different picture.

The average person in the USA generates over 15 tons of CO2 per year, whereas the average person in China generates only about half that. China in total generates more because it’s bigger, not because it has an especially bad energy infrastructure. In my home of the UK we’re lower still, at around 5.5 tons. The American lifestyle might be a dream, but it’s also a problem. Big cars, heated garden swimming pools, frequent flying — these things all contribute to that 15 tons.

Some might see this as an excuse for us in Europe not to take action. After all, in the UK we make up only just over 1% of global CO2 emissions. Maybe we should put off change until the big polluters have addressed their problems? I think this would be an enormous mistake.

Being in a leadership position means that we will be at the forefront of understanding and building the new green economy. New technologies, new businesses, experience of how to make this work — these are huge opportunities for economic growth. The reason Tesla is winning the EV battle is because they started first and have more experience, better technology and a greater economic footprint in the new world. For example, it takes Tesla ten hours to make a car, whereas it takes VW three times as long. Countries can learn from Tesla — the green transition is an opportunity, not a problem, and those who lead will win.

Why do so many car manufacturers source their batteries from China? It’s because China is investing aggresively to become a leader in the new green technologies and businesses. We should be doing the same.

Larry Fink is the CEO of BlackRock. His “Letter to CEOs” includes the following words (the bold emphasis is his, not mine).

In January of last year, I wrote that climate risk is investment risk. I said then that as markets started to price climate risk into the value of securities, it would spark a fundamental reallocation of capital. Then the pandemic took hold — and in March, the conventional wisdom was the crisis would divert attention from climate. But just the opposite took place, and the reallocation of capital accelerated even faster than I anticipated.

From January through November 2020, investors in mutual funds and ETFs invested $288 billion globally in sustainable assets, a 96% increase over the whole of 2019. I believe that this is the beginning of a long but rapidly accelerating transition — one that will unfold over many years and reshape asset prices of every type. We know that climate risk is investment risk. But we also believe the climate transition presents a historic investment opportunity.

Putting it bluntly, businesses that run on fossil fuels are going to start feeling some pain because their fossil dependence is a risk for investors. In contrast, those who embrace the new world will have a much greater ability to attract investment. Healthy economies run on investment.

It used to be said that we needed a good economy, otherwise we wouldn’t have the money to invest in social projects. If our planet is in crisis, however, it’s impossible to have a healthy economy — the economic cost of disruption and the conflicts and human migrations that would result are too significant for economies to thrive. And even if you’re skeptical of scientific projections (on what basis I do not know), it’s impossible to ignore that investors are now pricing in climate risk to their decisions. If we view the economy as the most important thing, climate change still sits at the top of concerns. If we were to ignore climate risk, our economy will only go in one direction — downwards.

There is a moral argument for being first, but I believe the economic argument is just as great. As Larry Fink says “I have great optimism about the future of capitalism and the future health of the economy — not in spite of the energy transition, but because of it.”

🧍 Taking personal action

It would be easy to sit back and wait for politicians to solve these problems for us. However, I believe we need to take our own action for two clear reasons.

Firstly, we can make a difference by taking actions like reducing our energy consumption, avoiding flying so much, cycling instead of driving, improving the insulation in our homes and eating less meat. Climate change is an issue because of the way that we’ve been living and we have a personal moral responsibility to change that.

To be blunt, we’re living lives that the planet can’t sustain and it’s nobody’s problem but ours to fix that.

If we don’t, the lives of our children will be more difficult. I want my daughter to inherit a better world than the one she’s currently on target to receive and that requires me to make changes.

However, as individuals we can have only a limited impact. Things like how our electricity is generated are beyond our individual ability to change. And many of us have limited financial means with which to adopt expensive new technologies like electric cars or heat pumps. We need politicians to change the big things.

This takes us to my second point — I believe strongly that the visibility of our personal actions will influence politicians to make bolder choices. The more of us who adopt an electric car, the more cycles on the roads, the greater the shift to lower-meat diets… these changes all send a sign. A sign that we take this stuff seriously and that positive climate policies will be vote winners. If a lot of us make small changes, this will start to give politicians the confidence they need that bigger changes might have the support they so desperately seek. If we can’t be bothered to make any changes, it should perhaps be no surprise if politicians don’t take the subject seriously either.

👉 My position

Life isn’t about taking as much as we can and to hell with the consequences. What’s the point of having children if we act in a way that means they inherit a world in turmoil, both climatically and economically? There’s a consensus amongst scientists that climate change is real and caused by us. Without action, our children are absolutely on course to inherit one hell of a mess. Climate change and sea level rises will cause major disruption in the next fifty years, not just around the world but in our own back yards. This stuff is serious.

To me there are only two courses of action that make any sense. Either we do something about this, or we decide to believe it’s all rubbish and the scientists are wrong. That latter course makes no sense — my gut feel versus the whole of the scientific community? I don’t think so. It follows, logically, that the only course of action worth considering is to try to do something about it.

So what am I doing?

I’m taking personal decisions that cost me money or arguably have some element of inconvenience. I’m no longer looking at “which is the best solution for me personally” but also trying to include “which is the best solution for the planet”. That means I’m moving from an ageing diesel to an electric car this year and planning some home alterations in order to reduce the carbon footprint of my house. These changes come with financial cost and some inconvenience, but I believe it’s time we faced up to the realities. Nothing in this life is free.

You will hear more from me on these topics in the coming months — communicating the experiences and hopefully influencing others is all part of the process.

I sit firmly on the side of the UN’s IPCC, the 98% of climate scientists who agree with its findings and the chairman of BlackRock. I believe that climate change is real and is caused by human activity.

But I also believe in our power to make change. I therefore embrace the new green world we’re going to create together — it’s an exciting time, full of change and opportunity.