Like many others, I’ve grown increasingly concerned over the years by the impact of climate change to the planet and society. Part of my unease stems from my longstanding passion for scuba diving, which has made me keenly aware of the impact of climate change and carbon emissions on the oceans. Scientists estimate that 70%-90% of all coral reefs, which play a key role in oceanic ecosystems, will disappear in the next 20 years due to global warming, for example.1 But I am also a father of two young daughters and think a lot about what kind of world they will inherit. As we have seen with the increased number of extreme weather events in recent years, climate change has a big impact on our lives and — most importantly — those that will come after us.
Understanding and preparing for climate change and the transition to a low carbon future are the core themes of A sea change in global investing, a new paper from BlackRock. This paper is the latest thought leadership on sustainability to come from BlackRock building on Larry Fink’s 2019 Letter to CEOs that outlined how climate risk is an investment risk. In this report, we go even deeper, and describe how the shift to a low carbon future is changing the economic and investing worlds and represents both a risk and an opportunity.