Profits / Investments
The insurance industry is trying to maximize profits - while analyzing the consequences of pollution.
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Worryingly, "insurers paid out more in claims than they received … and those losses are increasing.”
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If homes get destroyed more frequently (see global warming) there is a plan:
Raise rates in most places, and stop insuring in riskier areas. ​​​​ "It’s going to [become] harder to get insurance." ​​​​
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​ If insurance companies won't/can't help, the government could come in. ​
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The “National Flood Insurance Program has paid to rebuild houses that have flooded 6 times over.”
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Some areas will become “climate abandonment neighborhoods”.
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We "face brutal choices about which communities to save ... and which to sacrifice.”
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Weather & insurance expenditures are "resulting in a steady increase in the ... cost of homeownership.”
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In addition, insurance companies make money by insuring the biggest pollution-profiteers.
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"Liberty Mutual is insuring new tar sands pipelines, coal mines, oil rigs, and ... fossil fuel extraction.”
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“Major insurance companies invest more than half a trillion dollars … in fossil-fuels.”
Insurance companies, investors, and businesses deliberate over ethical quandaries regarding pollution.
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The stories of Boeing and Monsanto provide examples of how corporate profits are valued compared to people:
Monsanto knew "PCBs were harmful and pervasive, [yet] kept selling them." "They [hid] the dangers [to gain] profit.”
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Monsanto also tried to intimidate farmers into buying their agricultural products: ​
The hired bully may tell the farmer, “‘Monsanto is big. You can’t win. We will get you. You will pay’.”
Problems with Boeing airplanes followed a change in corporate leadership.
The new team seemed to want to "keep the stock price up and reap high executive compensation."
“What got lost [at Boeing] was a corporate culture that ... prized engineering and safety."
It was replaced by one that "focused [more] on delivering profits.”
Are investors/corporate-leaders willing to grab money - in an unethical way - as long as they won’t go to jail?
Oftentimes yes. Bringing in big bucks is what they were hired to do.
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A few years ago, positive "Impact" (ESG / SRI) investing became popular, but much of it was "greenwashing":
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”Pension funds" asked "portfolio managers [for] more climate-sensitive offerings [and to] divest from oil.”
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Businesses and investors, attempted "to protect ... assets and investments from climate risks.”
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“Private bank investors [were] tilting ... to renewables.”​
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The biggest pollution-profiteers found a way to fight back against this limited progress.
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-- "Wall Street’s retreat from earlier environmental pledges has been on [track] for months"
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-- Exxon said to push it "out of the oil & gas business" would decrease shareholder value.​
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A lot of the money-moving was to gain profit (or avoid losing $), not to clear the atmosphere:
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“A majority of directors at major banks ... are connected to polluting companies.”
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“Big banks have been making billions of dollars from bankrolling fossil fuels.”
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When will there be a transition to renewables? Investors like their reliable pollution-fueled profits, nevertheless:
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Fossil-fuels “are likely to become stranded assets, and investors don’t want to be left holding the bag.”
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If these fuels "need to stay in the ground", money for oil and coal "is inflating a multi-trillion-dollar bubble.”
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What if people invest "in fossil-fuels until suddenly the demand" drops off and "what they own is worthless"?
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OR, what if “Black pays for Green”: meaning to use pollution profits to gradually invest in a cleaner economy?
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Carmakers could produce electric cars, and oil / gas companies could become wind / solar companies --
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but only after making as much money as possible from more-polluting / more-profitable older styles of business.
One Big Oil CEO said: "'Black pays for Green'". Could that be true? ​​​​​​​​​
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In 2014 "companies, financial institutions and governments pledged to end deforestation" for palm oil and beef.
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Instead, deforestation accelerated. It's "'a deforestation economy'."​ “'It’s in our investments and pensions'." ​​​​​​​
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In 2020 the CEO of Volkswagen was removed: ​
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partly over his "cost cutting plans ... for a radical shift toward electric cars.”
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​The CEO of Ford had plans to move away from polluting vehicles but:
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"The road to consumer adoption for EVs, and [a] profitable EV business ... is a bumpy one," Jim Farley said.
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“The company is … reducing [what it'll] spend on electric vehicles ... to stem multibillion-dollar losses.”
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JPMorgan Chase "committed [billions] in financing for the fossil-fuel industry.”
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“Banks ... have continued to profit from illicit dealings with disreputable people and criminal networks.” ​
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One gas station owner,
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"has not ... installed an EV charger 'because there’s not really much profit'” in it.
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An EV charger costs more than $125,000. "A double sided gas pump ... $20,000.”
Pollution-producing businesses make up a big part of the US economy:
Autos - 3.5%
Tourism - 3%
Aviation - 5.5%
Dairy - 1%
Shipping / steel / timber / tobacco / cement / aluminium / ammonia-based fertilizer / trucking / the military - are all pollution-heavy businesses. If these add up to 5% of the US economy, polluting businesses would account for 25% overall!
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At least ¼ of the GDP of the USA comes from polluting enterprises? Could that be right?
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No wonder we've had only insignificant greenhouse-pollution reductions since scientists started warning us to stop.
Are you willing to quit your job - if applicable?
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Consider how we spend our money:​
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“USA Refinery yield 1993 - 2010:
46% - Finished Motor Gasoline
29.5% - Distillate Fuel Oil (for trucks, locomotives ... tractors ... home heating and electricity)
9.1% - Kerosene-Type Jet Fuel”-----
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Like at Volkswagen and Ford, the deliberations of BP (formerly British Petroleum) provide a controversial example:
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BP sold a profitable methane gas project in Oman (2021) to help "raise cash for ... renewable-energy projects." ​​​​
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However, "'If this is ... sunset ... for oil and gas, someone forgot to tell consumers’.” ​​​​
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BP's multi-billion dollar green gamble "failed to pay off".​
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Looney was replaced as CEO in 2023, and the company abandoned its "goal to cut oil output." ​​​​
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BP now has a focus on financial sustainability, "rather than ecological” sustainability.
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“Oil companies posted bumper earnings for the 2nd quarter," "driven by the return of air and road travel.”
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“The U.S. represents about five percent of the human population, but it consumes a quarter of the world's oil.”
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“The transportation sector is still 92 percent powered by petroleum products.”
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Our spending habits send investors a message. What do you want them to hear?
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By moving toward renewables, the 1990's CEO of BP (John Browne) claimed "he was responding to the wishes of consumers [who demand] cleaner alternatives."
Browne left BP in 2007, and the company backed away from his "Beyond Petroleum" ideas. In 2020 however, Bernard Looney took over as CEO. He also hoped to steer BP toward a "green" transition.
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Humans are "accelerating toward net zero emissions". He wanted BP to profit from this development.
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Looney got BP to go forward with the biggest "decarbonisation pledge" of all the "Oil Majors" in 2020.
A low bar, but BP did spend more $ than its competitors - "BP's investment in green technologies peaked at 4% of its exploratory budget." BP was also selling millions of barrels of oil equivalent daily.