Environmentalists are trying to turn the attention of the financial sector to climate change. The question is: Will it work?
At the end of last month, green activist Tom Steyer and former New York City Mayor Michael Bloomberg released a report warning that climate change brings with it major economic risks. Meanwhile, environmental group 350.org and other players in the environmental movement are urging divestment from fossil fuels as a way to send a market signal in favor of reducing global warming.
The financial push for climate action has also gained bipartisan support. Henry Paulson, who was President George W. Bush's Treasury secretary, took to the pages of The New York Times recently to say that inaction in the face of global warming has become a serious threat to our economy.
Should Wall Street play a role in efforts to address global warming? Can financial markets be used to achieve environmental aims? Or will attempts to use financial levers to yield green results fall short? If so, why? What are the economic risks of not taking climate into account in financial decisions? Have those risks been exaggerated?
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