Who’s Doing It Right? Fashion vs. Central Banks
by China Water Risk 17 July, 2020
Who’s Doing It Right? Fashion vs. Central Banks The IEA is warning that we only have six months left to change the course of our climate crisis. So who’s doing it right? This month, we take a closer look to see who is staying the course in COVID-times from global water management to coronavirus profiteers. Find out if it is the fashion industry or central banks that are acting faster to kick their oil habits. Also, where are major institutional investors on tackling their water risks and Hong Kong on its carbon transition?
We start with water – COVID requires frequent handwashing, hygiene and sanitation, hugely amplifying already existing water access and quality issues. Global water gurus, Dr. Tortajada and Prof. Biswas, say that we are not doing enough – even developed countries are faltering. In the US, at least 2 million people don’t have piped water. Lockdowns and growing unemployment have also meant that millions aren’t able to pay their water utility bills. The Guardian’s exposé on US water crises was sobering – already water bills have risen by 80% since 2010.
Parts of the UK will run out of water by 2030 with around 20% of public water supply lost to leakage everyday. Even in the EU, water spending must be upped significantly to comply with existing standards but in these uncertain times, such spending is unclear. With 20% ice loss in the Alps over the last 20 years to Siberia at 38°C; and floods in Wuhan to droughts in Australia, enlightened political leadership is needed – check out our water gurus’ thoughts on who’s getting water right.
Companies are not faring better either – it’s time to call out the coronavirus profiteers. Mighty Earth’s CEO Glenn Hurowitz expands on companies and industries that are exploiting the crisis as an excuse to extract tens of billions of dollars in new government subsidies.
Worse still, there are no green strings attached and environmental regulations have been slashed. Spoiler alert: the fossil fuel industry and the Trump Administration easily make the ‘bad’ list. Thankfully, there are still some climate heroes who are sticking to their green pledges.
Speaking of oil – fossil fuel companies can continue their guilty ways, propped up by fashion. Yes, you heard us right – fashion – it is practically frolicking in oil. We took a closer look to find that the fashion industry sucks up more oil than what’s produced by Qatar, Malaysia and Indonesia combined.
The main culprits are polyester and other synthetic “stretchy” fibres… think yoga pants and sports tops. The rise of athleisure has fuelled demand for oil. Then there are plastics in the hangers, sunglasses – the list goes on. We lay out five shocking facts so that you can rethink your wardrobe to avoid frolicking in oil.
To cut reliance on fossil fuels, Hong Kong needs a new plan to decarbonise by 2050 as it had only set mitigation targets for 2030. The HK 2050 initiative is on the case with a new report from Civic Exchange & WRI that shows a path forward to cut emissions by 90%. Lisa Genasci, the CEO of ADM Capital Foundation, shares key areas with the most reduction potential. Let’s see if the Hong Kong government follows through with this roadmap to realise a carbon neutral Hong Kong by 2050 and USD58bn in monetised benefits.
With floods hitting China, India, Bangladesh, Nepal and Japan as we write, we are not going to lie, it doesn’t look good on the water front. But there is an unexpected bright spot… the financial sector. Regulators and central banks are making waves.
With extreme weather losses amounting to USD316bn in 2018-19, Robin Miller of Ceres calls for bold regulatory action. She also singles out institutional investors that are getting on top of water risks, recommends tools for their assessment plus lays out key action steps from their latest report.
As for central banks – “IT finally happened” – we are now at the point where 66 central banks from around the world have finally recognised the various types of water risks and their complex interlinked nature, including water transitional risks which we’ve been harping on about.
CWR’s very existence is to embed water risks in finance and the half a dozen reports recently released by the NGFS has meant that we have now delivered a key milestone. Didn’t see these reports? Not surprising, they didn’t grab any headlines. But, they were a big deal and although there is still a long way to go, the regulators have basically set the direction for the entire financial industry for the next five years. We take a look at these game-changing moves and highlight key implications for the financial sector. A credit evolution has started – get on board.
With six months left to change the course of our climate crisis, you have to make sure you are on the right side of history. Mask up – it’s time to be a superhero – your planet needs you!
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