Climate Investing — Second Vatican Impact Investing Conference

Presentation from the Second Vatican Conference on Impact Investing, June 2016.

Climate Investing

Pope Francis’ Laudato Si from May 2015 greatly stresses the impact of climate change on the poor, and the Pope and Catholic church have consistently highlighted the importance of supporting the family of humanity through economic, social, and climate justice.

This session at the Second Vatican Conference on Impact Investing focused on examples of Climate investing for impact.

Presenters: Dr. Ellen Dorsey of Wallace Global Fund and Congressman John Delaney of Maryland

Moderator: Margaret Sullivan of Sullivan Strategy

Both presenters spoke about the various ways climate investing currently happens and future trends in the space. Moderator Margaret Sullivan began the conversation (at 2:10) with an explanation of the social and scientific changes that have occurred since the 2014 Vatican Impact Investing Conference and 2015’s Laudato Si:

  • the rise of visibility in the media and awareness of the climate crisis (at 2:28), and
  • the rise of temperatures confirmed around the world (at 3:20).

Dr. Dorsey highlighted the steady transition of the energy economy and market signals given by the Paris Agreement. However, she highlighted ‘uncertainties’ within climate investing (at 6:00) , including:

  1. The time-frame of working to stop climate change and the human rights implications of starting quickly; and
  2. Whether the energy transition will be just for all communities, how to leave no one behind.
“We don’t need to think of ourselves as Environmental Investors to invest in Climate solutions… climate change will impact every social justice issue that we care about.” — Dr. Ellen Dorsey

Dr. Dorsey then explained areas the Wallace Global fund practices climate investing by:

  • supporting the movement to divest from fossil fuels (at 8:30)
  • supporting models of Green Loans funds (the Catholic Climate Covenant) (at 9:13)
  • partnering with other philanthropic and faith institutions to launch a global civil society initiative to “end energy poverty by 2030” through calling mission-driven institutions to place 1% of assets in climate investing and work to create community-based partnerships. (at 10:20)

Congressman Delaney talked more about legislation recently passed and details around impact bonds, but not before highlighting three major ways climate change is affecting the poor (at 13:50):

  1. significant food-price increase;
  2. disease; and
  3. changes in migration patterns that affect the poorest parts of the world.

In order to combat this change, Congressman Delaney zeroed in on the need for investment and the need for innovation (at 15:30). The Social Impact Partnership Act (at 17:00) is a recent piece of legislation that supports pay-for-success programs to bring more private capital into solving issues that are viewed to be in the realm of government.

Dr. Dorsey was later asked about the ‘risks’ of climate investing (at 20:50), and related insights that

  • impact investing had a tendency to be hard to scale; and
  • the need for the community to be brought to the table throughout the design and implementation of impact programs.

Dr. Dorsey’s final point was a call to set stronger impact investing standards, in order to more accurately measure impact.

Congressman Delaney was asked to speculate the legislative and regulatory needs that are required to drive climate investing (at 26:50). Carbon pricing, investing in research, and empowering the impact investing community were among his answers to the policy changes necessary to promote climate solutions.