COVID-19 and the climate hole

In this Fiduciary Investors Series podcast Amanda White talks to Professor Cameron Hepburn,  Professor of Environmental Economics, and the director of the economics sustainability programme, at the University of Oxford.

They discuss: some of the more recent energy innovations; and the ideal price on carbon; as well as what is needed to move to a net-zero carbon economy.

Importantly Professor Hepburn discusses the role of finance and the need to recognise that both the finance and climate environments are complex adaptive systems, and that backward-looking analysis is not appropriate for adequate risk management.

“We need to get out of the old paradigms,” he says. “Even the concept of the Black Swan, doesn’t really help us to capture the fact these distributions are not bell shaped, or fat tailed or non-normal distributions. These are interactions between parts of the economy that are shifting the distribution altogether. So these things that are supposed to be a 1 in 10,000 event become the mean because you’ve shifted the distribution.”

He ends by offering some advice to institutional investors on how they should be including climate risks and opportunities into their investment decision-making, and the best way of doing that.

For further reading go to The Smith School of Enterprise and the Environment, Oxford University[vc_quotes layout=”accordion” quotes=”%5B%7B%22name%22%3A%22Cameron%20Hepburn%22%2C%22job_role%22%3A%22Director%20of%20the%20Smith%20School%20of%20Enterprise%20and%20the%20Environment%20(United%20Kingdom)%22%2C%22content%22%3A%22Cameron%20Hepburn%20is%20the%20Director%20of%20the%20Economics%20of%20Sustainability%20Programme%2C%20based%20at%20the%20Institute%20for%20New%20Economic%20Thinking%20at%20the%20Oxford%20Martin%20School.%20He%20is%20also%20Director%20and%20Professor%20of%20Environmental%20Economics%20at%20the%20Smith%20School%20of%20Enterprise%20and%20the%20Environment%2C%20a%20Fellow%20at%20New%20College%2C%20Oxford%2C%20and%20a%20Professorial%20Research%20Fellow%20at%20the%20Grantham%20Research%20Institute%20at%20the%20London%20School%20of%20Economics.He%20has%20published%20widely%20on%20energy%2C%20resources%20and%20environmental%20challenges%20across%20a%20range%20of%20disciplines%2C%20including%20engineering%2C%20biology%2C%20philosophy%2C%20economics%2C%20public%20policy%20and%20law%2C%20drawing%20on%20his%20degrees%20in%20law%2C%20engineering%20and%20doctorate%20in%20economics.%20He%20is%20on%20the%20editorial%20board%20of%20Environmental%20Research%20Letters%20and%20is%20the%20managing%20editor%20of%20the%20Oxford%20Review%20of%20Economic%20Policy.%20Cameron%E2%80%99s%20research%20is%20often%20referred%20to%20in%20the%20printed%20press%2C%20and%20he%20has%20been%20interviewed%20on%20television%20and%20radio%20in%20many%20countries.Cameron%20provides%20advice%20on%20energy%20and%20climate%20policy%20to%20government%20ministers%20(e.g.%20China%2C%20India%2C%20UK%20and%20Australia)%20and%20international%20institutions%20(e.g.%20OECD%2C%20UN%20organisations)%20around%20the%20world.%20Cameron%20began%20his%20professional%20life%20with%20McKinsey%2C%20and%20has%20since%20had%20an%20entrepreneurial%20career%2C%20co-founding%20three%20successful%20businesses%20%E2%80%93%20Aurora%20Energy%20Research%2C%20Climate%20Bridge%20and%20Vivid%20Economics%20%E2%80%93%20and%20investing%20in%20several%20other%20social%20enterprises%2C%20such%20as%20Purpose%20and%20Apolitical.%20He%20also%20serves%20as%20a%20trustee%20for%20Schola%20Cantorum%20of%20Oxford.%22%2C%22image%22%3A%2231863%22%2C%22linkedin%22%3A%22https%3A%2F%2Fwww.linkedin.com%2Fin%2Fcameronhepburn%2F%3ForiginalSubdomain%3Duk%22%7D%2C%7B%22name%22%3A%22Amanda%20White%22%2C%22job_role%22%3A%22Director%20of%20institutional%20content%2C%20Conexus%20Financial%20(Australia)%22%2C%22content%22%3A%22Amanda%20White%20is%20responsible%20for%20the%20content%20across%20all%20Conexus%20Financial%E2%80%99s%20institutional%20media%20and%20events.%20In%20addition%20to%20being%20the%20editor%20of%20Top1000funds.com%2C%20she%20is%20responsible%20for%20directing%20the%20global%20bi-annual%20Fiduciary%20Investors%20Symposium%20which%20challenges%20global%20investors%20on%20investment%20best%20practice%20and%20aims%20to%20place%20the%20responsibilities%20of%20investors%20in%20wider%20societal%2C%20and%20political%20contexts.%20%20She%20holds%20a%20Bachelor%20of%20Economics%20and%20a%20Masters%20of%20Art%20in%20Journalism%20and%20has%20been%20an%20investment%20journalist%20for%20more%20than%2025%20years.%20She%20is%20currently%20a%20fellow%20in%20the%20Finance%20Leaders%20Fellowship%20at%20the%20Aspen%20Institute.%20The%20two-year%20program%20seeks%20to%20develop%20the%20next%20generation%20of%20responsible%2C%20community-spirited%20leaders%20in%20the%20global%20finance%20industry%22%2C%22image%22%3A%2231864%22%2C%22linkedin%22%3A%22https%3A%2F%2Fwww.linkedin.com%2Fin%2Famanda-white-101a7515%2F%22%7D%5D” title=”” el_class=””]