3 Ways Your Money Can Fight Climate Change | Veronica Chau | TED

Financing the Green Economy

In this TED Talk, Rachel Kyte discusses the need for trillions of dollars per year by 2030 to avert a climate crisis. She explains that while over 450 financial institutions around the world have committed to aligning their financing to net-zero by 2050, it is proving difficult to deploy real money into real technologies that will actually decarbonize the world. Kyte argues that we can solve this problem by transforming challenges like affordable housing and climate change into financing opportunities.

The Challenge with Affordable Housing

• There is an affordability challenge with housing due to a scarcity of homes that are affordable right now.

• Energy-inefficient homes tend to be in Black and Brown neighborhoods due to poverty's structural nature.

• Buildings are one of the leading contributors to greenhouse gases fueling climate change.

• Building all this housing will only exacerbate the climate challenge if we take a business-as-usual approach.

Financing Opportunities in Sustainable Investing

• Banks can finance over a trillion dollars' worth of things to lower emissions associated with our housing.

• Banks work within prescribed risk thresholds, which means some things we need most might not fit within those risk thresholds yet.

• Investors need public policies, capital, and demand in order to put money into sustainable investing opportunities.

Simple Moves We Can Make

• We can create conditions that allow money to flow by making simple moves such as divesting from fossil fuels and investing in green bonds or funds.

• We can also advocate for public policies that support sustainable investing opportunities and hold banks accountable for their commitments.

Moving Trillions: Fostering the Climate Housing Connection

In this talk, Rachel Kyte discusses how to mobilize governments and big money to finance climate-friendly housing. She highlights the importance of blended or catalytic finance and the need for public policies, programs, and permits to incentivize private sector investment in affordable housing. She also emphasizes the role of institutional investors in financing social bonds that address social inequities.

Mobilizing Governments

• Blended or catalytic finance involves governments deploying their finance in instruments like guarantees or more concessional forms of lending to incentivize private-sector finance when governments take on more risk.

• The three p's - public policies, programs, permits - are necessary for bringing ambitious net-zero targets to life.

• Lack of minimum energy-efficiency standards and insufficient programs to incentivize homeowners are some challenges faced by banks willing to finance affordable housing developments.

• Voters can demand that local officials put in place financing, programs, and permits that attract private-sector investment in climate-friendly housing. Small numbers of voters can make a huge difference at the local level.

Mobilizing Big Money

• Institutional investors managing pension plans and insurance companies have begun appreciating long-term risks associated with climate change and social inequities as material risks to managing money. They're increasingly taking action by financing social bonds worth billions towards addressing social inequities including affordable housing.

• A mandate is needed for better integrating environmental or social considerations into how institutional investors manage money so they can put it to work towards trillions instead of billions.

Demand for Greener Solutions

In this section, the speaker talks about how we can create a demand for greener solutions by influencing governments, institutional investors and ourselves.

Influencing Governments

• Governments need to set policies that encourage the use of greener solutions.

• We need to influence large investors who are managing our money to consider environmental and social causes.

Institutional Investors

• Large pension plans and insurance companies have teams whose job it is to listen to our concerns.

• We need to make clear how we want them to consider environmental and social causes.

Creating Demand Ourselves

• We need to create the demand for these greener solutions.

• When buying or renting a home, ask about energy efficiency and overall carbon footprint.

Money Can Influence How Long We'll Be Here

In this section, the speaker emphasizes that money can influence how long we will be here on this planet.

The Power of Money

• Money can influence just how long we'll be here to enjoy the ride.

• What money can do is influence just how long we'll be here

to enjoy the ride.