Preventable Surprises helps market participants focus on systemic risk to avoid the next preventable surprise. Asset owners and institutional investors have a unique role in risk management because of the fiduciary duty they owe their beneficiaries. We support them in assuming this role—so vital to healthy market functioning—in three ways.
Online Dialogues Preventable Surprises has a network of positive mavericks that includes scientists, economists, securities analysts, central bankers, investment executives, and others. We turn to this network to inform and vet the strategies we pursue in highlighting and combatting systemic risks.
We use online dialogues as a means to connect people who live on multiple continents. We use the Convetit online engagement platform, which allows us to set up multiple topic sessions that our participants can join at their convenience, contributing to multiples streams of discussion. Below is a summary of the dialogues held so far.
- Asian Utilities: Our March 2018 dialogue invited discussion around the role of banks and investors in combatting development of new coal infrastructure in Asia. The power sector in Asia is estimated to produce 20% of global emissions. Discussion tackled the most appropriate narrative to use in different Asian countries, the role of British banks in financing new coal plants, and Japan’s support of fossil fuel development in other Asian countries. An event summary and infographic capture highlights of the three-day event.
- Transition Plans: In June 2017, dialogue participants engaged on whether scenario plans or transition plans would be more effective in reducing emissions at electric utilities. While the majority supported the latter approach, we also identified obstacles to transitioning to transition plans. An executive summary and an infographic are available summarising the event.
- Focus on Emissions: In September 2016, we held an online dialogue to plan for the 2017 annual general meeting season. The outcome was an agreement to focus on resolutions calling for low-carbon transition plans at U.S. utilities. We published two summaries of the event, an article and an infographic.
- Forceful Stewardship: In April 2016, our dialogue focused on developing the forceful stewardship skills needed to support 2°C transition plans. See event summary.
- COP21 Strategies: Our November 2015 dialogue set the stage for activism in the wake of the COP21 meeting in December in Paris. See event summary.
- Increasing Investor Awareness: Our first online dialogue in August 2015 was a discussion around how investors can best address climate risk, which formed the basis for the rest of our dialogues. See event summary.
Advocacy Investors learned a harsh lesson when the systemic risk building around mortgage lending crashed markets in what became known as the Global Financial Crisis. Today, we see climate change as posing the greatest threat to not only financial systems but also the planet we inhabit.
Here are some of the things we are doing to support the Paris goal to reduce greenhouse gas emissions in line with global warming of no more than 2°C:
- Focusing on shareholder resolutions in the utility sector (the 2017 AGM season was a busy one).
- Working with activist shareholders to draft effective resolutions
- Working with asset owners to build coalitions to support resolutions
- Working with asset managers to understand their objections to supporting resolutions, then providing a different perspective
- Using the media to increase pressure on asset managers
- Using online dialogues to build support for transition plans
- Providing research that helps corporates and investors understand transition plans.
Research We provide research and thought leadership in a variety of formats. This page provides a small sampling of our work. It is under construction—more items will be added in the near future.