Restart, yes — but on the right foot. The pandemic has caused the loss of millions of people around the world. It imposed lockdowns, with the consequent collapse of global production and the economy. Governments responded by allocating enormous sums of money to revive economic systems. From the United States to Europe, the figures run into the thousands of billions of dollars: the future of the Planet and of those who inhabit it will depend on how this enormous sum of money is invested.

Economy, climate, nature: the Planet is at a crossroads

The world, even before coronavirus, was at a crossroads. Science has made it abundantly clear that, in the absence of an immediate and drastic reduction in greenhouse gas emissions, the impact of global warming will be dramatic. Prior to the publication of the first part of its Sixth Assessment Report, the Ipcc — the Intergovernmental Panel on Climate Change — had already published the Special Report 1.5, which explains that even half a degree Celsius difference in terms of average global temperature increase would have profound consequences for the balance of ecosystems and the Earth as a whole.

The post-Covid recovery, therefore, represents a unique opportunity: to build a global economic system no longer founded on the logic of profit maximisation at all costs and on short-term results, but with an ethical approach, also taking into consideration environmental, social and governance (Esg) factors: respect for nature and the environment and climate protection, but also attention to rights and positive impacts on communities.

The importance of respecting the three "pillars" of Esg standards

The integration of Esg standards into public and private financing has important and extremely concrete consequences for people's lives. A classic example is that of renewable energy: the world must necessarily find alternatives to fossil fuels (coal, oil and gas) if it wants to meet the objectives set by the international community both from a climate perspective (with the Paris Agreement) and from the broader perspective of sustainability (with the United Nations 2030 Agenda). Resorting to clean energy sources is therefore increasingly necessary. And yet, the latter do not always respect the other two legs of Esg standards.

Today, there is increasing talk of a "just transition" — that is, the importance of combining the adoption of lower-environmental-impact business models (the E of Environment) with attention to responsibly managing the impact of this transition on workers (the S of Social). This is why in 2018 Etica Sgr signed the "Statement of Investor Commitment to Support a Just Transition on Climate Change".

Let us take another example: a large hydroelectric dam can guarantee electricity supply to tens of thousands of consumers at low impact in terms of climate-altering emissions. But if, hypothetically, building it requires flooding a valley in which tens of thousands of people live, the impact on them could be dramatic. They could in fact lose their homes, jobs and livelihoods. And years of history and culture could even be erased. The project, in short, could prove excellent for the climate, but harmful for local communities.

Etica Sgr ✓ @EticaSgr

𝕏

«Crediamo necessario che la risposta alla pandemia da COVID-19 coinvolga tutti i Paesi, non solo quelli sviluppati. Non realizzare un’azione inclusiva determinerà svantaggi per tutti»

@AldoBonati, Etica Sgr

👇
eticasgr.com/storie/campagn… @AtMIndex #covid19 #pandemia

♥ 3 25 mar 2021 · Apri su X →

The role of ethical finance for a truly sustainable economy

Even worse, of course, would be a scenario in which the recovery was carried out under the banner of business as usual. That is, perpetuating the same choices that have brought the world to the brink of climate catastrophe, imposed unacceptable inequalities (between nations and within them), left hundreds of millions of people in conditions of poverty and, during the pandemic, led to an inequitable global distribution of anti-Covid vaccines.

The role of finance, in this sense, can be crucial. Banks, investment funds and insurance companies manage immense amounts of money. And, just like governments, they can effectively shape the future of economic systems, by choosing to favour investments in companies and projects that respect the three legs of Esg standards.

An ethical vision to create shared economic and social value

"The Covid-19 emergency," say the experts at Etica Sgr, "is first and foremost a social emergency, and then a financial and economic one. It has highlighted numerous problematic elements that we were already aware of, but which are certainly emerging today in their full significance. This is the case with tax evasion, which has never appeared to us as starkly as in these past months, particularly in relation to the financial needs of the healthcare sector. In the same way, the fragility of undeclared work manifested itself forcefully when businesses found themselves in severe difficulties due to the lockdowns." But in many countries, social inequalities "that lead to ever-increasing poverty" and the lack of adequate investment in digital infrastructure "that limit access to services and training, useful for workers and students" also weighed heavily in a disruptive manner.

Etica Sgr ✓ @EticaSgr

𝕏

Come si sta evolvendo la #finanzaEtica in Europa? Come ha contribuito a contrastare gli effetti della pandemia? È online il 4° rapporto sulla finanza etica e sostenibile, a cura di @FFinanzaEtica e Fundación Finanzas Éticas.
👇
finanzaetica.info/wp-content/upl… @meggio_m @piccoloma

10 giu 2021 · Apri su X →

On the contrary, those who had already chosen the path of sustainability found themselves at an advantage in facing the crisis. "Our investment philosophy," the company's managers continue, "has always been based on a long-term approach. One in which overall returns tend to increase and losses to be minimised, and in which companies that are truly sustainable and create shared economic and social value are selected and rewarded. In general, sustainable and responsible funds mitigate financial risks more effectively during periods of uncertainty, as have our ethical funds. Ethical finance was born to place people and the environment at the centre of our financial, as well as economic, choices. This means recognising the importance of creating a more sustainable and inclusive economy, by taking a long-term perspective."