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What We Know and Don’t Know about Climate Change, and Implications for Policy (NBER, 35-page read) First, climate change uncertainty creates insurance value, which will push us for earlier action. Second, the CO2 emission is ‘irreversible’, which will also propel us towards earlier solutions. However, reducing theses emission has ‘sunk cost’, which will push us away from more rapid resolve.
3 Things About ESG Investing We Can All Agree On (MorningStar, 6 min read) ‘ESG risks can have a material financial impact’ ranging from climate change to violation of privacy – they impact the majority of firms. ‘Historically, there has been neither a material payout nor penalty for investors in global stocks that earn top ESG marks’. Many firms will use ESG rating primarily for marketing purposes without any value add. [Bearish ESG]