How ESG investing needs to ramp up to $1 trillion annually


Here’s this note by Andreas Rache:

Climate finance will need to increase to $9tn a year in 2030 to remain aligned with the Paris Agreement (up from $1.3tn in 2022). It is a no-brainer to make these investments, especially when considering that “damages are actually already considerably larger than mitigation costs” (Kotz et al.’s study, 2024 in Nature).

Very good discussion in today’s FT about where this money is supposed to come from. IEA estimate is that 30% will be financed by the public sector, while 70% need to come from the private sector.

A rather easy starting point would be to start cutting direct and indirect fossil fuel subsidies which amounted to $7th in 2022 based on this IMF analysis.