There was considerable concern about policy priorities under US President-elect Donald Trump at the recent Building Bridges annual convention of the Swiss financial and global sustainability policy community in Geneva.
However, there was also plenty of confidence in the robustness of sustainable finance among the some 2,500 attendees from over 110 countries. Johan Rockstrom, director of the Potsdam Institute for Climate Impact Research, pointed out that “even under Trump 1.0, US states moved decisively toward decarbonisation because it’s simply cheaper and more competitive”.
Ronald Cohen, president of GSG Impact and co-founder of Apax Partners, asserted that “we don’t need governments to lead us. Impact metrics are making it easier for us to hold ourselves accountable”.
Mindy Lubber, chief executive officer and president of the sustainability nonprofit Ceres, said: “I’m convinced, despite politics, we will see more investment coming from the private sector, from companies, from investors, from multilateral banks, in ways that we have never seen before because of the imperative.”
There is plenty of evidence to back up such assertions, even in the US, where the Invesco MSCI North America Climate ETF was listed on the New York Stock Exchange recently. The fund drew US$2.4 billion of assets from Finnish pension insurer Varma, the largest funding for a new ETF globally.
The ETF tracks the MSCI Global Climate 500 North America Selection Index, which targets companies reducing greenhouse gas emissions and those with emission reduction targets approved by the Science Based Targets initiative.
It’s doubtful that the Trump administration will shut down the fund and give investors their money back. Sustainability-focused finance, however imperfect, is now just too deeply established worldwide. Any damage that US climate sceptics may do to sustainable investing over the next few years will probably damage them and the US far more than it damages the thesis.
According to figures from the Deloitte International Wealth Management Centre Ranking shared at the Building Bridges conference, Switzerland booked over $2.17 trillion in 2023, or 21% of global assets under cross-border management. This makes the country the single most influential node for private wealth management, and therefore in a unique position to influence those wealth holders.
