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May 06, 2014

Third National Climate Assessment Published
    by Robert Kropp

In its new report, the US Global Change Research Program asserts that the effects of climate change have already become a present day concern, and announces the launch of a website to help Americans receive reliable scientific information.

SocialFunds.com -- The conclusions are straightforward in the Third National Climate Assessment of the US Global Change Research Program. Here they are:
1. Global climate is changing and this is apparent across the United States in a wide range of observations.
2. Extreme weather and climate events have increased in recent decades.
3. Human-induced climate change is projected to continue, and it will accelerate significantly if global emissions of heat-trapping gases continue to increase.
4. Impacts related to climate change are already evident in many sectors and are expected to become increasingly disruptive across the nation throughout this century and beyond.
5. Climate change threatens human health and well-being in many ways, including through more extreme weather events and wildfire, decreased air quality, and diseases transmitted by insects, food, and water.
6. Infrastructure is being damaged by sea level rise, heavy downpours, and extreme heat; damages are projected to increase with continued climate change.
7. Water quality and water supply reliability are jeopardized by climate change in a variety of ways that affect ecosystems and livelihoods.
8. Climate disruptions to agriculture have been increasing and are projected to become more severe over this century.
9. Climate change poses particular threats to Indigenous Peoplesí health, well-being, and ways of life.
10. The capacity of ecosystems to buffer the impacts of extreme events like fires, floods, and severe storms is being overwhelmed.
11. Ocean waters are becoming warmer and more acidic, broadly affecting ocean circulation, chemistry, ecosystems, and marine life.
12. Current implementation efforts are insufficient to avoid increasingly negative social, environmental, and economic consequences.

So what do we do now, knowing that the legacy we leave for the generations to come is already compromised, if not far worse? What actions do the sustainable investors for whom I write take? When I started writing for SocialFunds.com in 2007, I recognized how sustainable investors were embarked on a paradigm-changing mission: to change the fundamental concerns of the capital markets from within.

Seven years later, I can state with certainty that I have never before met the number of committed and empathetic individuals that I have had had the honor of being in contact with through my writing for SocialFunds.com. I can further state that my contacts with them has left me entirely unequipped to ever consider writing for a mainstream investment medium: I could never view risk assessment other than through the lens of environmental, social, and corporate governance (ESG) factors.

But the sustainable investment revolution that in my naivete I anticipated has not come to be. For one thing, the same avarice that compels the fossil fuel industry to pour billions of dollars into delaying the certainty of such findings of those in the Third National Climate Assessment is mirrored in the get rich quick schemes still employed by many mainstream investors. Prop up the stock price of ExxonMobil, even if the fossil fuel reserves listed as assets on its balance sheet are enough to realize the worst-case climate change scenarios.

But the most serious question is really outside the province of sustainable investment, even if most of its practitioners are dedicated to environmental and social justice. The question is about the fate of capitalism itself. Two hundred years ago, the French visitor de Tocqueville observed that the inevitable end of American capitalism was the concentration of wealth in the hands of the few. The time he foresaw has arrived; if we are on the verge of an unprecedented crisis, what use is it to its solution that investors focus on maximizing their returns, either through short-term sleight of hand or consideration of ESG factors?

I cannot help but think that the problem may be the existence of an Achilles's heel in the genes of the human race.

Robert Kropp can be contacted at rjkropp@yahoo.com.

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