Asset Owners Can Save the World - Seriously

• Asset owners (i.e., pension funds) can start a revolution themselves by adopting Full Market Disclosure.

• The flood of climate data would generate a center of pricing gravity that will pull all financial transactions into its orbit and reshape the way everyone sees the world, right down to the way that we price each individual transaction based on solid fresh information.

• As fiduciaries, asset owners never lose by demanding transparency from their service providers.

We believe that Asset Owners & Managers can efficiently serve their fiduciary obligations with respect to sustainability specifically through:

I: Full Market Disclosure

Real-time transparency by institutional investors of how they price sustainability, including qualitative and quantitative analysis and data disclosed transaction by transaction.

Asset Owners & Managers can be powerful activists by immediately publishing their Full Market Disclosure of their current entire portfolio online and updating it with historical data later.

II: ESG Data is a Public Good

Data, ratings, and models used by institutional investors are made available to everyone to use for free with complete transparency around sources, algorithms, ratings, and models so we can all interpret the Full Market Disclosure.

Asset Owners & Managers can form a consortium to jointly pay ESG ratings and data providers sufficient fees to make their product free and completely transparent.

III: Right to Innovate in Sustainability Pricing

Ensure the right to innovate in sustainability pricing (i.e., that no good ideas or talented people are lost under intellectual property, non-compete, and non-disclosure agreements) so that we can continuously improve Full Market Disclosure.

Asset Owners & Managers can influence their peers and service providers to make sure that their talent is free to develop their best ideas.

IV: Climate Proof Software

To keep Full Market Disclosure and our economies going (particularly our food systems - otherwise avoidable famines may occur) when the climate shocks intensify, we need to be able to update and fix our software without relying on the firms that made it. Therefore, we are advocating for our worldwide technology stockpile to transition to the freedom-based GNU General Public License Version 3 by January 1, 2028.

Asset Owners & Managers can use their voting power to quickly push companies to move their software to GNU GPL V3 so that our technology base can be repaired and adapted to function during the coming climate shocks.

Volume Actuators

To date, sustainability securities volumes in capital markets have been relatively trivial. For example, “In total, corporate green bonds amounted to around 3 % of the broader EU corporate bond market (as of November 2021, the European Securities and Markets Authority writes).”

These simple changes will turn a trickle into a waterfall.

Conclusion

• We recently heard that at the Harvard Kennedy School of Government the professors are teaching their students that climate change is now a certainty.

• Based on any reasonable measure, the need to go the extra mile now while we still have a chance to influence the outcome through the markets should be taken.

• This is a complex subject and we will be adding detailed papers describing exactly how we think that this should be implemented.