Yemisi Izuora
The investment bank Goldman Sachs is set to make available $750 billion over the next decade to invest in and finance cleaning up the energy industry, along with making farming more sustainable and reducing poverty, the company said Monday.
In an op-ed in the Financial Times, Goldman CEO David Solomon wrote, “companies have traditionally treated sustainability as a peripheral issue, focusing narrowly on the way they manage their impact on the environment.”
“We don’t have the luxury of that limited perspective any more. The evidence of climate change is clear,” he said. “Profitability will always matter… But finance must also address climate transition and inclusive growth while achieving and sustaining those returns.”
The move comes amidst increasing calls from corporate America to move on reducing the use of oil and other fossil fuels to address climate change.
Solomon echoed call from many other CEOs for the U.S. government to enact a carbon pricing scheme, something Republicans have by and large rejected as damaging to the U.S. economy – particularly in states like Texas where the sale of fossil fuels is a major economic driver.
“The markets can and will do much to address climate change, but given the magnitude and urgency of this challenge, that will not be enough,” Solomon wrote. “To give us the best chance of combating climate change, governments must put a price on the cost of carbon, whether through a cap and trade system, a carbon tax or other means. The resulting incentives will channel capital to low carbon solutions and drive innovation. Combining public policy, technology and capital is a must, not a choice.”