“We have an aging infrastructure system in the United States that’s being devastated by storms.” – 03:42
Jeff Gitterman, CEO of Gitterman Asset Management, joins Remy Blaire at the New York Stock Exchange to discuss climate adaptation and the challenges it faces, particularly in light of a new report from the non-profit organization Probable Futures. The report reveals a troubling lack of consensus among global leaders on effective climate adaptation strategies, warning that poorly designed efforts could inadvertently worsen existing issues. For example, flood barriers may simply shift risks downstream, and some solutions might trade one climate threat for another.
Jeff emphasizes that the ongoing debate about the reality of climate change complicates the ability to define climate adaptation clearly. This confusion leads to fragmented efforts at the local level, with insufficient guidance from national or international bodies.
The conversation highlights the necessity of establishing a clear definition of climate adaptation and resilience, which could help identify successful investment opportunities in the capital markets. Jeff points out that for private markets to engage meaningfully in climate adaptation, they need to recognize investable themes, particularly in areas like water supply and fire resistance. He shares striking examples, such as the resilience of certain homes in Maui and Florida after devastating hurricanes, illustrating the potential benefits of targeted adaptation investments.
As Climate Week approaches, Remy and Jeff explore strategies that publicly traded companies can adopt to align with climate adaptation goals. Jeff highlights recent papers from major institutions like JP Morgan and GIC, which outline focused agendas on climate adaptation strategies. He notes that for every dollar invested in adaptation, there can be a return of $6 to $44, underscoring the economic viability of such investments.
The discussion also addresses the challenges of loss aversion in funding climate adaptation, where investments are often made to avoid future losses rather than to create new opportunities. Jeff stresses the importance of layering social and environmental benefits onto these investments to make them more appealing to Wall Street and government entities.