EU green deal forces investors to view climate as an immediate threat

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One of the most significant successes of the European Union’s climate policy may be to persuade investors to consider global warming as a present concern rather than a distant threat.
The EU’s ambitious Green Deal launched on Wednesday (July 14), covers everything from automobiles to cement and aims to reduce emissions by at least 55% by 2030 compared to 1990 levels.
The so-called Fit for 55 package has enormous consequences for money managers by forcing them to address the near-term economic impacts of the Earth’s changing climate, even though it says little explicitly about the banking industry.
Greenhouse gas pollution must be cut in half by 2030 to attain net-zero emissions by 2050, and the target experts say they must be met to prevent global warming to 1.5 degrees Celsius. Even though a growing number of businesses and financial institutions have declared their own net-zero goals, many have been chastised for failing to demonstrate how they plan to achieve them.
The EU’s 2030 goal is part of a larger aim to create Europe the world’s first carbon-free continent. It unveiled a massive package on Wednesday that includes extending the world’s largest carbon market to include shipping firms, banning new combustion-engine automobiles, and levying steel, cement, and aluminium imports. While the statement focused on the real economy rather than the financial sector, it comes on the heels of a slew of new rules announced earlier this month to put the financial industry in line with the carbon neutrality objective.

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