The workers who fuel the global supply chain warned of a possible 'systems collapse' if solutions aren't found

Grace Kay
Thu, September 30, 2021

A container cargo ship in Rotterdam Harbour on April 4, 2021 in the Netherlands. Rotterdam is the largest shipping port outside of Asia.

 Niels Wenstedt/BSR Agency/Getty Images


Several industry groups representing 65 million transport workers warned the situation is getting dire.


The groups called for world leaders to give transport workers more mobility and access to the COVID-19 vaccine.


The letter comes as global supply chains face multiple snarls, delaying goods and hiking prices.


Workers from across the supply chain warned world leaders on Wednesday that global trade is facing a possible "system collapse" if solutions aren't quickly reached.

In an open letter to heads of state at the United Nations General Assembly, four industry groups, including the International Chamber of Shipping, called for governments to put an end to travel restrictions for transport workers and give the workers priority access to COVID-19 vaccines that have been approved by the World Health Organization (WHO).

"Global supply chains are beginning to buckle as two years' worth of strain on transport workers take their toll," the letter said. "Their continued mistreatment is adding pressure on an already crumbling global supply chain."

The workers groups - which represent over 65 million seafarers, truck drivers, and airline workers across the globe - pointed to limits that had been placed on their movement due to the pandemic, including travel bans and additional requirements at borders.

At the onset of the pandemic about 400,000 seafarers were forced to stay aboard their ships for as long as 18 months - well over their contract periods. The workers' groups said the poor treatment of workers in the transportation sector has exacerbated a worker shortage that will only get worse if the industry is not prioritized.

"It is of great concern that we are also seeing shortages of workers and expect more to leave our industries as a result of the poor treatment they have faced during the pandemic, putting the supply chain under greater threat," the letter said. The group went on to add that they request an audience with the WHO and the International Labour Organization "to identify solutions before global transport systems collapse."

The letter comes at a time when global supply chains are facing historic disruptions. In the US, ports in Southern California have taken the center stage as over 60 hulking cargo ships wait weeks to dock and unload, setting multiple all-time records. In key export markets like China, ports have faced numerous shutdowns due to the country's zero tolerance policy for COVID-19 outbreaks.

The delays have rippled throughout the supply chain, as trucking companies face massive shortages of drivers, and warehouses run out of space for goods. Experts say the delays are only set to worsen in the coming months and will likely continue into 2023, as consumer demand booms ahead of the holiday season while companies work to restore inventory.

CRIMINAL CAPITALI$M
BP Trader Dealings With Nigerian Middleman ‘Didn’t Smell Right’



Jonathan Browning and William Clowes
Fri, October 1, 2021

A BP Plc executive told internal investigators he was concerned about the energy giant’s dealings with a Nigerian middleman and payments being discussed to secure lucrative contracts.

The suspicions didn’t make it into the investigators’ final report, which emphasized that the 2017 deal never went through. But notes from their interviews show a senior executive at the company’s London headquarters was worried that proposed payments to an agent in the West African country would be used for bribes.

When an agent demanded a payment of $5 million to help facilitate what was set to be the biggest deal BP’s traders had ever done in Nigeria, the head of origination for the region, Chris Schemers, told investigators that he said to his team the agent wants the money “so he could pay someone off.”

The documents have come to light in a mammoth employment suit that is running yards from BP’s trading floor in London’s Canary Wharf and highlights the level of internal nervousness surrounding the role of agents in oil trading.

“And he wants upfront, didn’t smell right to me,” Schemers said, according to the documents prepared for the London employment tribunal that’s poring over allegations of bribery and trading losses in BP’s crude trading team.

The team “needed to be super careful” and he had a “bad feeling” about the middleman, Schemers said.

Those notes from Schemers’ interview didn’t make the final report, codenamed Project Topaz, when it was circulated some six months later in the summer of 2019.

Schemers, who left BP in March 2019, told investigators that there was no “smoking gun” to prove corruption, but he’d worried that the agent was just a “one man band.”

He didn’t respond to a message requesting comment on LinkedIn.

Jonathan Zarembok, who worked on BP’s West Africa trading desk, sued BP in the U.K. saying he was deemed a troublemaker for raising concerns about transactions in the run up to Nigeria’s most recent elections in 2019. He’s seeking to have his multi million pound bonuses that were slashed in half and then cut to zero restored.

BP never did make the payments to the agent -- with other executives suggesting that the agent was demanding too high a fee that threatened the economics of the deal. The company has argued in the legal suit that Zarembok never raised corruption concerns at the time. The report concluded there was a “disconnect” between what had really happened and the allegations made by the trader.

In Nigeria, local rules required oil firms to work with Nigerian firms if they wanted to acquire crude oil cargoes marketed by Nigerian National Petroleum Corp., the country’s state oil producer.

“It is widely known in the oil trading community that the Nigerian political parties use NNPC as a means to funnel money into political campaigns,” Zarembok said in his witness statement prepared for the six-week trial.

“BP is defending in full and denies all allegations made by the claimant,” the firm said in a statement. It declined further comment, including on Schemers.

BP separately made payments totaling $900,000 to another agent to participate in a state oil tender.

Zarembok was ultimately dismissed in April 2020 because the working relationship within the team had irretrievably broken down, BP has said.

North Dakota drought exposes 130-year-old shipwreck


Sophie Reardon
Fri, October 1, 2021

The Abner O'Neal sank while traveling down the Missouri River in 1892. Nearly 130 years later, the shipwreck still sits on the bottom of the North Dakota portion of the river and recently became visible to visitors, according to CBS Bismarck affiliate KXMB-TV.

North Dakota is currently experiencing a statewide drought, and, as a result, the Garrison Dam on the Missouri River has been releasing less water. Archaeologists said receding water levels revealed the ship's remains, KXMB-TV reported.

Built back in 1884, the steamship carried grain between Washburn and Bismarck-Mandan. Eight years later, the Abner O'Neal was transporting 9,000 bushels of buckwheat when it struck a snag or a rock and began to sink between Washburn and Mandan. The cargo on board and the boat itself were a total loss, according to the State Historical Society of North Dakota's website.

The ship, which has largely remained intact since it sank, was also seen during the 2011 Missouri River flood.

Local resident Nyk Edinger went to see the shipwreck himself. He said he appreciates the little piece of history.

"A lot of our history has been torn down because weather is extreme, so to have something as old as the Abner O'Neal and still being able to see the actual iron and wood that went into that ship with our own eyes is an incredible experience," he told KXMB-TV. "Something as historic as that, something as old as that, something that came long before me and will be here long after I'm gone, was an important thing for me."

Officials are asking the public not to disturb the wreckage.

"It is public property and a protected historic site so when visiting it, it is important to only take pictures and be respectful," said Andrew Clark, the state's chief archeologist.

Abner O'Neal shipwreck in the Missouri River in North Dakota. / Credit: State Historical Society of North Dakota

VIDEO State Historical Society of North Dakota - Wreck of the steamboat Abner O’Neal | Facebook

Fossil of Peacock-Like Dinosaur May Have Preserved DNA Remnants


Matthew Hart
Fri, October 1, 2021

Although dreams of an IRL Jurassic Park are still just that, nearly every dinosaur finding still tantalizes with possibility. In a new fantasy fueling discovery, scientists in China say they’ve found evidence of “remnants” of original dinosaur DNA. Which may or not actually be there depending on how future experiments shake out.

An illustration of the Jehol Biota in China with a well-preserved specimen of Caudipteryx in the foreground.
ZHENG Qiuyang

Gizmodo reported on the discovery of the evidence, which a team of scientists from the Shandong Tianyu Museum of Nature outlined in a new paper in the journal Communications Biology. In the paper, the scientists describe how they isolated “exquisitely preserved” cartilage cells from a 125-million-year-old dinosaur from Northeast China. One that apparently looked a little like a peacock. The specimen, from the genus of small feathered theropod dinosaurs, Caudipteryx, was approximately the size of the modern day, fanciful bird. And it even had a long, feathered tail.

To look for evidence of dino DNA, the scientists took a piece of fossilized cartilage from the specimen’s right femur and decalcified it. They then used different chemical and microscopy methods to analyze it; in part by staining it with hematoxylin and eosin, chemicals that react with the nucleus and cytoplasm of extant cells. (The stains are immediately below. The Caudipteryx cells are on the left, those of the chicken, on the right.)

Close-up images of (potential) dinosaur cells and chicken cells stained with a purple chemical.
ZHENG Qiuyang

When the scientists stained both the Caudipteryx cartilage and that of a chicken, they found the two specimens reacted identically. The scientists even say that one of the dinosaur’s cartilage cells revealed a nucleus with fossilized threads of chromatin. That’s the material that makes up the chromosomes of organisms other than bacteria.

“[W]e are obviously interested in fossilized cell nuclei because this is where most of the DNA should be if DNA was preserved,” Alida Bailleul, corresponding author of the study, said in a press release. The scientists have “very exciting data,” but are “are just starting to understand cellular biochemistry in very old fossils,” she added.

A slab of rock containing the fossilized outline of a peacock-like dinosaur from China.
ZHENG Qiuyang

Indeed, as Gizmodo‘s report highlights, many experts believe that these researchers have not actually found evidence of dinosaur DNA. They told the news outlet, for example, that—even under the best circumstances—DNA couldn’t last more than three million years. Let alone more than 100 million. And that the chemicals may have been staining inorganic matter that only looks cellular in nature.

As of now, the most ancient DNA that scientists have been able to sequence was that of a million-year-old woolly mammoth. And the youngest dinosaurs are at least 65 million years old. But if future experiments do confirm this evidence as real, then that really changes things. At least in our fantasies, where reanimated dinosaurs and Ian Malcolms abound.

The post Fossil of Peacock-Like Dinosaur May Have Preserved DNA Remnants appeared first on Nerdist.

Wells Fargo's Mike Mayo expects automation to kill off 100,000 banking jobs: 'It's really a swap to bots from bankers'

Stephen Jones

Fri, October 1, 2021, 

100,000 banking jobs could be lost over the next 5 years, say Wells Fargo. Spencer Platt/Getty Images

• 100,000 banking jobs could be lost to automation, a Wells Fargo report said.

• MD Mike Mayo told Bloomberg that "it's really a swap to bots from bankers."

• Back office and low-paying roles are more likely to be affected, the report said, per Bloomberg.

• See more stories on Insider's business page.

Wells Fargo predicts automation could cut as many as a 100,000 banking jobs over the next five years.

Clients of the bank were sent a 110-page report late on Monday detailing the potential impact of digitization on Wall Street and it's workers, Bloomberg reported. On Thursday, Mike Mayo, Wells Fargo's managing director, appeared on Bloomberg TV to discuss the report's findings.

"It's really a swap to bots from bankers," Mayo told Bloomberg's Emily Chang. "Developers are the new bankers. The chief technology officers at banks are now some of the most important people at banks."

Mayo predicted that two-thirds of the cuts would be in back-office jobs. A third would hit front-office roles, which typically are more client facing, he said.

The client report suggested lower-paying roles were more likely to be affected, per Bloomberg.

Mayo said that tech would also create new roles, partially offsetting some of the losses, but didn't say how many.

Tech will help banks become more efficient than they have been before, Mayo said, by allowing them to modernize call centres, back offices, and branches. Swapping to cloud and other third-party storage would also help, he said.

Banks need to automate in order to keep up with fintech, big tech, retail, and others, Mayo said. This would benefit customers, who increasingly favor online or digital-only banking, he said.

Mayo admitted that the industry was struggling to compete with tech companies in the war for talent. "The competition for tech talent has never been more fierce and banks are bearing some of the brunt of that," he said.

In a note sent in May, Mayo and other Wells Fargo analysts predicted that as many as 200,000 jobs could be shed within a decade as a result of tech adoption, according to Bloomberg.

Top dog: Greek leader's pet interrupts news conference


Slovakia's Prime Minister Eduard Heger pats Peanut the dog of his Greek counterpart Kyriakos Mitsotakis as they leave Maximos Mansion in Athens, Thursday, Sept. 30, 2021

 (AP Photo/Thanassis Stavrakis)

Thu, September 30, 2021, 


ATHENS, Greece (AP) — Peanut has met several visiting European leaders since becoming Greece’s top dog back in April.

On Thursday, the golden-haired former stray decided to give himself a louder introduction -- briefly interrupting a news conference being held by the prime ministers of Greece and Slovakia.

Greek Premier Kyriakos Mistotakis expressed support for the country’s Balkan neighbors efforts to join the European Union, and froze momentarily as Peanut could be heard barking loudly a few meters away at the prime minister’s official residence.

“That is the dog we recently adopted who is often quite lively,” Mitsotakis said, turning to Slovakia’s Eduard Heger, who laughed as he listened through an interpreter.

“This is the first time he has intervened during a press conference. Usually, he just greets guests at the door and is more polite,” Mitsotakis said.

He adopted Peanut after visiting animal welfare volunteers on World Stray Animals Day in April. The dog, who typically wears a blue bandana over his collar, has been spotted roaming the rooms of the official residence, known as Maximos Mansion.

Mitsotakis’ government has led efforts to crack down on animal cruelty.

Parliament last year voted to make serious animal abuse punishable by up to 10 years in prison. Last week, lawmakers approved plans to create a national pet registry with DNA samples of cats and dogs that have not been sterilized.

Last year, Greek President Katerina Sakellaropoulou, a former senior judge, adopted Calypso, a stray cat rescued on the island of Karpathos.

The two have been photographed together for social media posts.

Taiwan questions China's suitability for Pacific trade pact, fears 'obstruction'


A Taiwanese flag flaps in the wind in Taoyuan

Ben Blanchard, Yimou Lee and Jeanny Kao
Thu, September 30, 2021, 

TAIPEI (Reuters) - China's restrictive practices present fundamental problems for its application to join a major pan-Pacific free trade pact, and if it joins before Taiwan there is a risk it could block their application, the island's economy minister said.

Taiwan and China both applied last month to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), but China says it opposes Taiwan - which it claims as its own territory - joining.


"If China enters first, certainly there is a risk of them obstructing Taiwan," Taiwan Economy Minister Wang Mei-hua told Reuters in an interview late on Thursday. "Taiwan joining anything, they oppose."

China says it has the right to represent Taiwan's 23.5 million people in international bodies regardless of the island's claim that it is an independent country.

Beijing has numerous issues, from internet censorship to labour rights, that call into question whether it can reach the CPTPP's high standards, she added, saying those requirements are set to "challenge China's very fundamental systems".

"If China can change these, I think changing this system and then entering (the trade pact) is not a bad thing. But the prerequisite is that if this system is not changed, why can they enter CPTPP? This is an issue I don't really understand," she added.

"Look at their information - nothing can enter. Facebook can't enter, Google can't enter," Wang said, referring to China's blocking of both major sites, which it does to a slew of Western internet firms including Twitter, all in the name of national security.

The original 12-member agreement, known as the Trans-Pacific Partnership (TPP), was seen as an important economic counterweight to China's growing influence.

But the TPP was thrown into limbo in early 2017 when then-U.S. President Donald Trump withdrew the United States.

The grouping, which was renamed the CPTPP, links Canada, Australia, Brunei, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam.

Taiwan, a major semiconductor producer, has applied to join under the name it uses in the World Trade Organization (WTO) - the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu. Taiwan is also a member of the Asia-Pacific Economic Cooperation grouping.

Wang said Taiwan was not aware of any CPTPP member objecting to their application, in contrast to the disquiet expressed by Japan in particular about China's bid.

"At the very least after we submitted the written application, we've not heard that any member opposes, not like after China applied, when some countries brought it up."

Taiwan has been angling for free trade deals with other countries, especially other democracies. Wang said if it joined, it would not need to seek a separate agreement with Australia, or fellow CPTPP applicant Britain.

While talks to enter the WTO went on for more than a decade, Wang said she did not think it would take that long for the CPTPP, but added it was hard to give a timetable.

"I think if the political obstacles can be reduced as much as possible, I don't believe talks will go on for decades."

(Reporting by Jeanny Kao, Yimou Lee and Ben Blanchard; Editing by William Mallard)

Mexico displays pre-Hispanic artifacts recovered from abroad

Fri, October 1, 2021

MEXICO CITY (AP) — Two Mexican museums have opened a massive show this week of 1,525 pre-Hispanic and historical artifacts, more than half of which were recovered from abroad.

Mexico has long had a problem with collectors or traffickers taking artifacts out of the country, even though that has been illegal since 1972.

But 881 of the sculptures, vessels and other artifacts on display in Mexico City were returned, either voluntarily by foreign collectors or through police seizures abroad. They were returned from the United States, Italy, France, Germany and the Netherlands.

For most, it is the first time they have been seen in Mexico.

Many of the other 644 pieces had been seized in Mexico or had long sat in warehouses. Forty-six of them are on loan from museums abroad.

“What is being gained here is the possibility for us Mexicans to see these pieces again, or even to see them for the first time,” said Miguel Angel Trinidad, one of the curators.

One example, an impressive Mayan stela, shows a warlord grasping a captured rival. It had previously been on display in Los Angeles, California.

The show is called “The Greatness of Mexico,” and the pieces on display come from pre-Hispanic cultures like the Mayas, Aztecs and Olmecs, as well as later pieces. The pieces will be on display in Mexico City's National Anthropology Museum and the colonial-era museum of the Public Education Department.

The show coincides with the 500th anniversary of the 1521 conquest of Mexico City by the Spanish, and the 200th anniversary of the consummation of Mexico's independence from Spain in 1821.

Mexico Archaeology Exhibition

Miguel Angel Trinidad Melendez, of the National Coordination of Museums and Exhibitions of the National Institute of Anthropology and History, takes part in the launch of “The Greatness of Mexico” exhibition, displaying for the first time in the country more than 800 pieces repatriated from abroad in the last three years and others that were in safekeeping and confiscation warehouses, at the Anthropology Museum in Mexico City, Friday, Oct. 1, 2021. (AP Photo/Marco Ugarte)

'We will not go quietly': 

Women's March organizes over 500 marches nationwide for reproductive rights

Christine Fernando, USA TODAY

Thu, September 30, 2021,

A month after a Texas law banning abortions after six weeks of pregnancy went into effect, Women's March protesters will gather in support of reproductive rights on Saturday at more than 650 marches in all 50 states and Washington.

Women's March executive director Rachel O'Leary Carmona said that while abortions have never been fully accessible, a Mississippi challenge to the landmark Roe v. Wade decision, Texas' abortion legislation, and the possibility of other states following the Lone Star State with similar laws, represent an "unprecedented attack" on reproductive freedoms.

"For a long time, groups of us were ringing the alarm bell around abortion access and many of us were told we were hysterical and Roe v. Wade will never be overturned," Carmona said. "But now it's clear that our fears were both rational and proportional. We are at a break-glass moment for America, and now's the time for mass mobilization and federal action."

The marches are being planned ahead of the Supreme Court reconvening Oct. 4.

"We don’t say this lightly," the Women's March said in a tweet announcing the marches. "We’re at grave risk of losing our reproductive freedoms. All of us need to fight back."

'Women rising,' but numbers falling: 2020 March tries to reenergize amid flagging enthusiasm

'Shadow Docket': Senate battles over Supreme Court 'shadow docket' in the wake of Texas abortion law

The Supreme Court in September declined to block Texas' abortion law – a move the Women's March said "effectively took the next step towards overturning Roe v. Wade," according to its website.

"Simply put: We are witnessing the most dire threat to abortion access in our lifetime."

The Women's March is partnering with more than 90 other organizations, including Planned Parenthood, National Latina Institute for Reproductive Justice and the Working Families Party amid what they've called "relentless attacks."

"This isn't just the Women's March but rather a coalition effort," Carmona said.

She added: "This is not just a women's issue. It's a racial justice issue. It's an immigration issue. It's across the board because abortion is healthcare and a fundamental right."

Inside clinics: Abortion clinics outside Texas see surge in patients since ban

New legislation: House passes legislation protecting the right to an abortion

It's important for the marches to include women of color in the organizing process, Carmona said. The mobilizing and organizing committee behind the event is composed of women of color, she said.

Organizers are calling for people to pledge to march ahead of Oct. 2 by visiting the event page.

Masks and social distancing will be required at the marches, according to the event page. Organizers will also provide hand sanitizer stations and urge anyone who feels sick to attend a virtual event instead of an in-person one.

Virtual events are also a way to include immunocompromised people and others who might not be able to attend an in-person march, Carmona said. She encouraged people to donate to abortion funds and contact their representatives to voice support for abortion access.

The inaugural Women's March in 2017 launched to protest then-President Donald Trump's election. Last fall, a march paid tribute to the late Justice Ruth Bader Ginsburg and to protest now-Justice Amy Coney Barrett’s nomination to the Supreme Court.

"This is a moment to consolidate our movements and to demonstrate to policymakers and to the Supreme Court that we will not go quietly, that this is going to be a fight," she said.

He Helped Start the ESG Movement. 

Now He Wants to Fix It

Saijel Kishan
Fri, October 1, 2021


(Bloomberg Markets) -- Steve Lydenberg’s passion for social change was inspired by anti-Vietnam War demonstrations, consumer boycotts, and the movement to divest from apartheid South Africa. But he didn’t take to the streets. Instead, Lydenberg turned to the world of finance to help catalyze societal change.

In 1990 he co-founded KLD Research & Analytics, the first firm to conduct environmental, social, and governance analysis of S&P 500 Index companies and sell that research to Wall Street. While there, he co-created the first socially responsible investing index of U.S. companies, now called the MSCI KLD 400 Social Index. But, as investor appetite for ESG data and sustainable investments has grown, Lydenberg says ESG has fallen short in addressing systemic issues such as inequality and climate change. So in 2015, he co-founded The Investment Integration Project, known as TIIP, to encourage what it calls ­system-level investing. Lydenberg, who turns 76 this month, spoke with Bloomberg Markets in August. The interview has been edited for length and clarity.


SAIJEL KISHAN: How did you get into ESG? Did you have a ­background in finance?

STEVE LYDENBERG: None whatsoever. My only advanced degree is in theater arts and playwriting from Cornell. I was in New York City in the mid-1970s for the theater scene, to see if I could get my plays put on. I didn’t want to wait on tables, so I thought, “Let me do some interesting research,” because I like research. I was concerned about the war in Vietnam and the economy, and I basically stumbled on the Council on Economic Priorities. They were one of the first organizations that was trying to rate and rank companies on social and environmental issues. It was aimed primarily at consumers, and the consumer-boycott theme at the time was very strong. I worked for them for 12 years before I decided that this was a career.

SK: How did you make the jump to finance?

SL: I became fascinated with finance and what it could do. The financial community obviously has great affinity for figures, but it loves a story as well. Many of the charts and figures ­economists and the financial industry like are essentially stories about the future.

This was also a time of a lot of street demonstrations and really high polarity of protests. There was a fair amount of violence, too. So the use of investment tools was interesting to me, as it seemed to me a more orderly way of bringing these issues to, one, the public’s attention, and two, to actual transformative change.

SK: What got you thinking about systems-level investing?

SL: We had reached a tipping point where the mainstream said, “Yes, of course, social and environmental issues can be material to individual security selection and portfolio risk.” At KLD we were involved in marketing that data. By, let’s say, 2010 it was clear there was a market. Bloomberg was including the data on their terminals.

But, in a disjointed way at the same time, the major issues were really coming to the fore and getting worse and worse. Climate change, income inequality. All this recognition of the value of ESG data and its integration into valuation models and portfolio risk management, that wasn’t really making a difference when it came to the most serious issues of the day.

SK: What event caused you to realize that ESG needed to evolve and that systems-level investing was needed?

SL: The launch of the United Nations’ Sustainable Development Goals. Those are systemic issues. Companies and the financial community were saying they were aligned with them or wanted to be aligned with them. But it wasn’t clear what that meant. If all they were talking about was cleaning up portfolios, it wasn’t clear how cleaning up portfolios as alignment was going to get you to the SDGs.

SK: Is systems-level investing ESG 2.0?

SL: Let me be clear here, because I had a little trouble myself in coming to this formulation. I don’t believe systems-level investing as we see it replaces ESG integration, security evaluation, and portfolio risk management. They are incredibly important. But there is a certain class of risk that is systemic risk that investors are impacted by and requires an additional set of tools and way of thinking.

SK: What are the characteristics of a systems-level issue?

SL: First of all, they involve global issues. Second, they are destabilizing in some fundamental way. And third, they’re very hard to predict the outcomes of, and one’s ability to impact them. The simplest way of saying what a systems-level issue is for an investor, just as a litmus test, is: Does it impact your assets across all asset classes? And the implication of that is, you need another set of tools to deal with these.

SK: What are those tools?

SL: Let me give you four examples. One is what we call self-­organization. It’s the same as collaboration, basically entering a collaborative enterprise like Climate Action 100+, which has a systemic view of a problem and how it can be addressed. Collaboration doesn’t come easily and naturally in the financial world; the model is competitiveness. Competitive is good if you are only looking at your portfolio or a given security. It’s what makes for discipline in the marketplace. But if you’re going to deal with a complex, global issue, then collaboration becomes just essential. It’s so much easier now than it was even five years ago. Coalitions are being formed all the time.

Second is what we call interconnectedness. The easiest way to think of it is the sharing of data on a pre-competitive basis. And again, the financial industry is not used to sharing data; it’s closely held and the basis of your competitive advantage. One example is Calpers [California Public Employees’ Retirement System] and Calstrs [California State Teachers’ Retirement System] have this database for diversity on boards of directors. So if a company wants to hire, make offers to directors on diversity issues, there’s a database. Another example in the area of labor relations is the Workforce Disclosure Initiative, now part of [U.K. responsible investing nonprofit] ShareAction. It’s aimed at standardizing and ultimately mandating disclosure on workforce employment practices so everybody is on the same level. Employee relations is a great tool for distinguishing which company is going to do better than another company. Sharing data is a way that everybody can start from the same point. The implication is those standards are going to be used not just to pick stocks, but to engage. There is a public good of having that data out there.

The third is public policy. Investors have been basically told that unless it directly relates to some technical part of how the financial industry runs, how derivatives are measured, they should stay out of any social and environmental policy issues. Public policy includes things like subsidizing an industry such as renewable energy and setting tax advantages to encourage industries that are growing. You will then be able to pick and choose which companies will win, but you will have a public policy that supports the whole industry.

Finally, the fourth one is what we call evaluations of intangibles. Clearly certain social and environmental systems have value, and some of that value is very hard to price. There’s a lot of stirring about how investors can support biodiversity, but putting a price on biodiversity is very hard. You can talk about what is the cost of the loss of pollinators. You can talk about certain kinds of losses, and that is a worthwhile thing to do. But in the end, the commitment is not just to everything that you can price. The commitment is to the whole system. The complex, interrelated, ­biodiverse system. It’s a situation where the whole is essentially worth more than the parts. What’s the value of a forest? It’s got a value as a whole, but if you cut it up into little pieces, it’s not equivalent to the whole. And current practice when confronted with that issue is “I can’t really quantify those things, so I’m going to ignore it.” And now this whole movement around capitals—natural capital, human capital, social capital—reflects that.

SK: How can investors address that?

SL: One way of addressing the complexity issue is through scenarios. The Task Force on Climate-Related Financial Disclosures deserves a great deal of credit for prompting investors, as well as corporations, to engage in scenario analysis when it comes to climate change. [Michael Bloomberg, founder and chairman of Bloomberg Markets parent Bloomberg LP, serves as chairman of the task force.] The point of a scenario is that it takes you a little bit away from jumping immediately to a simple solution that you think will work for everything in a complex system, and allows you to prepare yourself for a range of possibilities. By our definition, a systems-level issue is one of great uncertainty. So scenarios are very helpful. An example of that is sea-level rise. Scientists can predict the feet of sea-level rise but only within a range. So we don’t know exactly how fast it’s going to rise, how fast the polar ice caps are going to melt. We think maybe 3 feet is a reasonable number for sea-level rise by the end of the century, but it could be 10 feet in an extreme scenario. So you prepare yourself as an investor, even if you can’t apply it immediately.

SK: Which investors have started practicing systems- level ­investing?

SL: The New Zealand Superannuation Fund, for one. The prerequisite of a systems-level investor is a commitment that manifests in an investment-belief statement specifically referring to ­systems-level investing. New Zealand Super says that it believes climate change is one of the fund’s most critical investment risks and opportunities. That lays it out there. And they also say they believe that climate change is a market and policy failure and that carbon is not efficiently priced. So they tie it to policy failure. These are strong statements.

Secondly, they say climate is a risk across all asset classes, a risk that they won’t be rewarded for. These are all from New Zealand Super’s climate change report 2020. On the public equity side, they have very judiciously and systematically reduced their exposure to carbon. They’re doing this slowly, because they want to make sure that they’re not going to adversely impact performance. Big picture is they look across all their asset classes, they do scenarios, they do active engagement and proxy voting. They are part of coalitions and data-sharing efforts. Everything started with equities and now is spreading out more systematically into other areas such as sovereign debt. This is fascinating to me, that engagement is now engagement with government on systemic issues.

SK: How do you decompress after dealing with overwhelming issues like climate change?

SL: I read a lot of mystery and detective novels. That’s my idea of relaxing. And my idea of a summer vacation is sitting by the lake and reading. I work intensely, and so I believe in long vacations to recharge.

Kishan reports on ESG and climate for Bloomberg News in New York.