Climate change and cognitive dissonance

In the fight against climate change, there is often a disparity between the information available to us, our day-to-day behaviour and the priorities and values of most of us. This disparity may result in an absurd denial of the facts, so that we don’t have to make any changes to our behaviour.

Are you familiar with the syndrome of the deer frozen in the car headlights and unable to move in response to danger? I am often reminded of this syndrome when thinking about the fight against climate change and our procrastination despite the obvious risks. In my view, highlighting the opportunities also represents an additional, logical and efficient strategy for creating positive momentum, making it crystal clear that this decade must be the decade of action and decarbonisation.

However, the paradox remains the same. Although modelling on the impact of climate change over the next 20 or 30 years is conclusive, inaction is leading us into a dystopian future. We are not taking sufficient action to correct the trajectory and change our behaviour, and are thus jeopardising our future. So it is legitimate to ask whether we are all of sound mind.

Have our systems crashed?

Sébastien Bohler, author of Le Bug Humain reminds us of the role of dopamine, the feel-good molecule released by our brains as a reward for satisfying our primary instincts. Our brains are not programmed for self-restriction, but rather for encouraging us to maximise our comfort while limiting our efforts: to eat to survive in the short term, reproduce to survive in the long term, advance up the social ladder, collect useful information on our environment, etc.

This tendency to always want more is useful in a hostile environment with limited resources, but becomes problematic in societies where goods are produced industrially in unlimited quantities. Our brain does not have an inbuilt brake or stop system, it is programmed to always want more and, wherever possible, more than our neighbour. It is not surprising that the majority of the global population live in countries where being overweight and obese kills more people than being underweight.

The further away the challenge is in the future, the less impact it has on our decision-making.

Furthermore, not only are we programmed to always want more, but also to want it immediately. The marshmallow experiment illustrates to us that our early brain is blind to the depth of time, and reacts only to immediate gratification. The further away the challenge is in the future, the less impact it has on our decision-making.

As regards the fight against climate change, the future threat does not seem to carry sufficient weight to rein in our search for gratification in the present. And yet the cognitive dissonance, i.e. the conflict between what we know and what we are doing, releases stress molecules (cortisol and noradrenaline) in our brain, which will create anxiety and deep unhappiness. This cognitive dissonance must be resolved one way or another: either we align our actions with our knowledge, or we deny what we know so that we can carry on as we are.

The phenomenon of eco-anxiety or the chronic fear of environmental disaster has today become a reality for society. In contrast, changing the way we think to align with our actions creates a denial mechanism that aims to legitimise and uphold our current behaviour. We have to fight our own biases before we can fight climate change.

Encouraging action on the basis of new meaning

We need to create new meaning between our day-to-day actions and our knowledge of future challenges. How can we live in an affluent society and end this cognitive dissonance in order to create new meaning? By promoting change rather than criminalising the status quo!

It is key that we stimulate other pleasure zones and change our social norms. We must promote restraint, empathy and unhurriedness in our daily habits. We must wean ourselves off our dopamine fix and focus on the power of awareness and presence in order to rediscover pleasure and end the permanent escalation. We must rediscover that the pleasure molecule can also be released by curiosity, by the energy of knowledge. Our cerebral cortex has created intelligence and technology. It also has the capacity to create awareness. This is called growing up and gaining our freedom by our refusal to remain addicted to our dopamine fix.

We must develop the ability to be patient and practice delayed gratification.

Some may think I am getting lost in an esoteric exercise. Maybe I am. But I personally believe that we must develop the ability to be patient and practice delayed gratification. Every parent knows exactly what this is and how important it is in helping a child to become an adult. It’s also what distinguishes the wisdom of the investment world from the frenzy of speculation. Placing our impulsions on hold requires effort, deliberate action, and mental and cognitive strength. In any case, that’s how I read one of the famous quotations attributed to Warren Buffett: “You can’t produce a baby in one month by getting nine women pregnant”. Excellence takes time!

Clearly, we still have room to improve our energy intensity and our carbon intensity. For industrialists and investors alike, identifying and determining the convincing and winning technologies in the fight against climate change is a complex exercise. There will be many opportunities, but also numerous pitfalls along the way. If you asked me whether science and technology can resolve most of these issues, my answer would be yes. But we also need to act urgently, and cannot content ourselves with banking on future promises.

Collective and individual responsibility

Human ingenuity also includes our ability to change our consumption and production habits. The famous maxim of “business as usual” must be done away with. The future is not predetermined, it is constructed daily by our choices of action or inaction. There are many existential threats to our future. But we must be aware that solutions do exist. Whether we face a dystopian or a bright future depends entirely on the choices that we make today.

As investors, we must not neglect the ability to use our money to promote change and to do this consciously. Monitoring our own carbon footprint has become quick and easy. There are many simulators available to help us understand the issue and then take action on the way we travel, eat, heat our homes, etc. But that clearly misses one link in the chain: the money we invest that is used to finance businesses and companies with high CO2 emissions.

Everyone is now aware that we are already suffering the effects of climate change. Time is running out and we cannot continue to squabble or look for scapegoats. It is truly irresponsible today to claim that we can limit global warming to 1.5 °C. But it is just as irresponsible to claim that we can’t achieve this. Giving up the fight is not an option. We have a collective responsibility. The courts are starting to take an interest in this, but history will be the best judge of who were the guilty, the depraved and the conmen. Witch hunts (greenwashing) cannot be a priority.

Fuelled by authors such as Alain Grandjean, Julien Lefournier and Gaël Giraud, the debate surrounding the limits of sustainable finance has the merit of serving as a reminder that, ultimately, it is companies and governments that can initially change the real economy. Their actions must be commensurate with the climate emergency and the acceleration in the destruction of biodiversity. But remember that the picture depicted by finance is often incomplete. It is necessary, but not enough, to focus on the flows. The stock is just as important. The typical example can be found with renewable energy. It is essential to roll out renewable energy production, but exiting fossil fuel production must be part of the roadmap. In other words, a combination of moderating our behaviour and transforming our consumption habits.

Are we mixing up emotion and reason? Probably, but that’s nothing new in the investment world, which is based on hard-nosed fundamentals, and at the same time, on emotional behaviour.

Sources:
– Urgence écologique et stratium by Sébastien Bohler, the author of Bug Humain
– Gerd Leonhard, The Great Transformation
– L’illusion de la finance verte by Alain Grandjean, Julien Lefournier, Gaël Giraud