Essay by Eric Worrall
“Destruction culture destroys wealth and progress” – Stuart Kirk’s warning to those who want to silence debate about green investments.
“Climate change is not a financial risk” – HSBC’s Chief Investment Officer Stuart Kirk resigns
Via Velvet-Belle Templeman
July 8, 2022 1:38 ONLYStuart Kirk, global head of responsible investments at HSBC Asset Management has resigned following an explosive response to a recent speech he gave insisting that climate change is not is a financial risk.
In one LinkedIn Posts announced his resignation, Kirk said that HSBC’s behavior towards him since the speech has made maintaining the role, ironically, “unsustainable”.
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“Investing is difficult. The same goes for saving our planet. Opinions on both differ. But humanity’s best chance of success is open and honest debate. If companies believe in diversity and speak up, they need to start the conversation. A culture of destruction destroys wealth and progress,” he wrote.
“There’s no room for Virtue signal in finance. Likewise, as a writer, researcher, and investor, I know that word of mouth or trading of stocks can only achieve so much. The real impact comes from a combination of real-world action and innovative solutions.”
What message does this resignation under pressure send to investors, in terms of the quality of advice they can get from bankers about investments in climate change?
Spain has proven renewable investments can actually be very risky, when The Spanish government retroactively canceled the solar tariff in 2010 bankrupted 10 thousand people who thought they could rely on the promises of politicians. The UK also cut the solar tax in 2011cause similar pain.
Stuart’s guilt is to explain in detail why adaptation is a better strategy than mitigation, using IPCC figures. He also criticized the central bank’s unclear management of climate risk models: – “Even with a carbon tax, even with growth, they cannot make climate risk move the needle, so they have to have their smart winks in the back room putting a huge interest rate shock on their models to get attention.”
We could all be about to experience an interest rate shock – but it will be because excessive public borrowing and political attacks on affordable energy have boosted consumer prices. consumption and inflation, not because global warming damages the production of any important goods.
Now, Stuart has “resigned”, and posted a comment on social media about “cancelling culture”. Draw your own conclusions.
Don’t expect any more warnings from the banking industry – Stuart’s “resignation” in my opinion sends a strong message that bankers have questions about the financial principles of green investing will be fired or have to resign.
If you haven’t watched it, Stuart Kirk’s keynote is available here.
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