As humans, we’re wired to focus on the now. I want a new gadget now. I want a slab of pie now. I’m busy now, so I don’t have time for politics. The consequences—consumer debt, a sagging waistline, a Congress beholden to special interests–all arrive later.
You can think about global warming as a now-and-later problem. Governments need to take unpopular actions now to deal with a problem that will do most of its damage later. Businesses need to look beyond the next quarter to the next quarter century.
This evening in Elsinore, Denmark, top executives from such companies as Coca-Cola, Duke Energy, Goldman Sachs and Google took the long view in a fitting venue: Kronborg Castle, a 15th century castle best known as the setting for Shakespeare’s Hamlet. Sitting in a magnificent castle that’s been preserved for six centuries makes you wonder what impact the goings-on on Copenhagen this week will have on the world in 60 or even 600 years.
In that context, it seems prudent to invest now to insure against a climate catastrophe, no matter how distant–even if the short-term result is a slight drag on short-term economic growth
As Tracy Wolstencroft, global head of environmental markets for Goldman Sachs, put it: “The economy is a wholly owed subsidiary of the environment, not the other way around.” That is, if we ruin the environment, there’s no economy left. [click to continue…]
Mark Tercek left Goldman Sachs after a long and successful career midway through 2008, just before the global financial meltdown. Good timing, except that Tercek moved on to become the president and CEO of The Nature Conservancy, the world’s biggest environmental organization, as the global climate crisis is intensifying.
He feels the pressure. There’s more work than ever to do, and money is tight at the conservancy. “This is really hard,” Tercek told me recently. “What a responsibility we have to get this right.”
Mark Tercek
By “this,” Tercek means climate change policy in general and REDD in particular. REDD stands for Reducing Emissions from Degradation and Deforestation, and it’s an absolutely crucial strategy for dealing with climate change that requires slowing the growth of agriculture, forestry and cattle ranching to protect forests in places like Indonesia and Brazil. Because tropical forests are being degraded or cut down at an alarming rate, Indonesia and Brazil are ranked No. 3 and No. 4, respectively, by some studies when it comes to carbon emissions, behind the U.S. and China but ahead of Japan or Germany. Deforestation could account for as much as 25 percent of emissions, these studies show.
The fundamental idea behind REDD is to get businesses and governments in richer countries to help finance sustainable livelihoods for people in poor countries so they don’t have to cut down trees to earn a living. [click to continue…]
Setting aside, for a moment, whether we really need yet another senior Goldman Sachs executive in a big job in Washington, the nomination of Robert Hormats to be Undersecretary of State for Economic, Energy and Agricultural Affairs raises anew troubling questions about Goldman’s role in raising money for a Chinese oil company that helped finance the genocide in Darfur.
Robert Hormats
Hormats played a leading role in defending PetroChina (NYSE:PTR) when Goldman took the Chinese oil company public in 2000. Worse, Hormats’ statements at the time, which included assurances that money from the public offering would not flow to the Sudanese government, were later investigated by the Securities and Exchange Commission, which brought a case against Goldman that the company settled for $2 million. (Here’s a Washington Post story on the settlement.)
That’s not enough money, to be sure, to matter at Goldman, but still, it makes you wonder: How much due diligence did the Obama administration and Secretary of State Hillary Clinton do before nominating Hormats?
You’d think that misleading people about genocide might be sufficient cause to disqualify an executive, even one with impeccable Goldman ties, from a state department post.
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