There’s no ‘good-willed’ investment

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There’s no ‘good-willed’ investment

The author is the head of Factpl team of the JoongAng Ilbo.

I use a tumbler instead of disposable cups, diligently sort my recycling and try not to keep the air conditioner on for too long. But I often feel helpless and wonder if my contribution really helps the problem. The wildfires and floods recurring across the world threaten more lives each year. I cannot relieve my guilt with the duties of an ordinary citizen.

The fastest capitalist way to turn collective anxiety into a driving force for change is money. In January 2020, Larry Fink, chairman of BlackRock, the largest asset management company in the world, started it with one email. He wrote that when making investment decisions, climate change risk and ESG (environment, social and governance) will be considered first, and declared a fundamental restructuring of finance. Liberal politicians and businessmen raved over the “good capital” unwilling to invest in companies close to fossil fuels. The fossil fuel industry and the U.S. conservatives did not acknowledge the climate crisis itself. But the world had high hopes for BlackRock.

However, BlackRock recently betrayed expectations, saying it was against the interests of the clients who entrusted their money to BlackRock to ignore fossil fuel-related investments in the era of high oil prices. The capital management agents have no power before returns and political pressure. From the beginning, expecting “good capital” was wrong. Money moves for profits. Humans put character on money and use it for political gains.

It is important to not be deceived by marketing slogans like “good capital” or “good investment.” The more “bad and dirty” framing is put on oil, gas and coal capital, the cost of conflict grows. The Moon Jae-in administration’s nuclear phase-out policy based on the dichotomy of justice and injustice is one example.

Then what should we do? Money tells us what to do. Global climate technology start-ups are attracting investments. According to venture capital research firm Pitchbook, global investment on climate technology was $44.8 billion last year. In 2020, the amount was $22.1 billion. It is not because they are good money. If the global problem is solved, the fruits of the profit will return to global levels. Venture capital is rushing in for that “opportunity.”

In Korea, the climate technology ecosystem started to move from last year. But the speed of start-ups cannot keep up with that of money. Sopoong Ventures CEP Han Sang-yeob, who created a 10-billion-won ($7.5 million) climate technology fund, said, “As there are not many climate technology start-ups in Korea, it is more urgent to train master’s and Ph.D. holders in deep tech as entrepreneurs.” As Korea is experiencing natural disasters every season, this could be the role of the government policy funding. This is a market with opportunities across the world beyond semiconductors. I wish for smart investments from the government.
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