My finances, my projects, my life
May 25, 2020

Is the coronavirus ‘good news’ for our planet?

  Olivier Goemans myINVEST April 9, 2020 163

“If you are going through hell, keep going, that’s not a place to stop” is a statement attributed to Winston Churchill. As the coronavirus continues to exact a terrible human toll around the world, it also allows us to imagine a different world for our future.

From my understanding of our economic systems, I could never have thought about an intentional recession. If no confinements, no social-distancing and no mitigation strategies were being attempted, the health care crisis could have been far more destructive. Clearly, the economic damage will have been diluted but long-lasting. Biting the economic bullet today gives hope for a better tomorrow, in sharp contrast to traditional ‘kick the can down the road’ approach we have grown accustomed to.

For the first time in our lives, greenhouse gas emissions are on a steep decline. Satellite images of air pollution have highlighted the largest scale experiment ever in terms of reduction of nitrogen dioxide over different parts of the world. Coronavirus is bringing some short-term benefits in that the worldwide shutdown of industry and the drastic reduction in transport have cut fossil fuel use and pollution, while improving air quality.

Pessimists will claim that the coronavirus is kicking global warming off the public agenda, acting as a dangerous distraction to climate priorities. On the contrary, optimists will claim that everyone got a wakeup call about how “fragile life is, and that nature is stronger than humans”1. It seems that we always forget that we are at the mercy of nature.

Covid-19 will eventually go away, let’s hope we will have learned some lessons when it does. Could the move to a zero-carbon economy be slowed from the oil price crash? Honestly, I don’t know. My only conviction is that the argument often put forward by oil majors, that they can’t invest in renewables because oil and gas projects offer much higher returns, is not valid anymore with a price below $30/barrel and renewables being much lower risk. As warned by Valentina Kretzschmar, director of corporate research at Wood Mackenzie, “the sector is already very much unloved by investors, and it’s only going to get worse. I would like to see the oil and gas sectors starting to seize opportunities in the megatrend that is the energy transition. Because there are opportunities. It is a growing trend, and the pressures to transition and to tackle climate change are only going to increase.”

Global issues like Covid-19 or climate change see no boundaries, nor passport. A key difference being that climate change has been suggested for decades with impact perceived to be encountered in the future, not something immediate, while embedding a feeling of helplessness.

Is there a “coming together” perspective on fighting the virus and climate change? According to David Comerford2, the two are similar in that they involve an escalating probability of disaster and feedback loops, disruptions to our lifestyles, the need for societies to cooperate to face the threat, and the acknowledgement from governments that the issue needs tackling urgently. In essence, global issues see no boundaries, nor passport.

A key difference being that climate change has been suggested for decades with impact perceived to be encountered in the future, not something immediate, while embedding a feeling of helplessness.

In essence, the perception of threats is a strong accelerator of massive and fast changes in human behaviours. This give us comfort that writing such series of articles on sustainable finance and climate change could further consolidated the buy-in of emergency for actions. Let’s be ambitious and optimist. We are all part of the problems as well as the solutions. We simply need to act now!

We observed that during the coronavirus pandemic and despite the costs and inconveniences of lockdowns, public opinions were mostly approving those containment actions. Humanity is learning how to do big things again! The ability to personalize the damage of behaving irresponsibly is very important. We have to do a better job of getting society to make the leap of empathy – and that means putting a face on the likely victims with whom they can identify and that they love. Another dimension is that focusing on fear and risks is promoting procrastination. A better way is to develop a sense of purpose and grasp opportunities to make sustainable changes in our lives.

Civil obedience should be coupled with an active imagination and a vast and varied library.

Keep in mind that great thinkers like William Shakespeare and Isaac Newton did some of their best work during quarantines in the times of plagues. In the current context, let’s hope that the lucky-one working or studying from home could come up with some hidden silver linings. Civil obedience should be coupled with an active imagination and a vast and varied library.

Regardless of how long the pandemic will last, it is bound to lead some deep changes in our societies. It is likely to challenge our world views and force us to redefine priorities in order to prevent or prepare for new crises. It also offers us a huge learning opportunity. While there is a necessity for businesses to communicate, the crisis has demonstrated our capacity to adapt with meaningful solutions. That learning experience will reset the way we organize ourselves. It remains to be seen whether nations in lockdown will be able to maintain some of the sustainable practices adopted in haste to curb exposure to COVID-19, such as working from home.

The supply chains of global enterprises are clearly disrupted by halted production, highlighting its embedded fragilities. But we should avoid the trap of populism and xenophobia. As rightly commented by Ilvo Diamanti, an Italian sociologist, “the world no longer has borders that cannot be penetrated. One would have to defend oneself from the world. In order not to die contaminated by others and become spreaders of the virus ourselves, we would have to die alone. This is a greater risk than the coronavirus”. Enforcing digital connection and common wisdom, favouring efficiency of proximity should be the foundation of an anti-fragile supply chain. The missing link inside global crises, is again, empathy and our limited capacity to collaborate.

The missing link inside global crises, is again, empathy and our limited capacity to collaborate.

The show must go on. For those that haven’t come to the realization that it’s a different world than the one we were in just a few weeks ago, it’s going to be a painful path going forward. Stay safe and healthy

1 Victor Weis, director of the Heschel Center for Sustainability.
2 David Comerford – Program Director, MSc Behavioural Science, University of Stirling: Coronavirus should give us hope that we are able to tackle the climate crisis