Friday 04 October 2019
Climate Change - Can Guernsey Clean Up? Risks, responsibilities and opportunities in changing times
Let's play word association. If I say....
...'haven', what's the first word that springs into your head?
The right answer of course is: 'safe haven' - a term I tried to coin for Guernsey a couple of years ago
But if you are honest, probably, what came into your head was of course: 'tax haven'
Let's just park that for the moment. I'm come back to it at the end.
Last Friday, I was asked to give an impromptu address to the estimated 1,000 local students, who participated in the Climate Action march from their schools and colleges to the States. I can tell you, it was a more daunting audience than tonight!
I want to pay tribute to those who organised that event. Some of them are here tonight on the student table and I will say again, what I said last week: 'I commend your commitment and passion; and the peaceful expression of views should always be welcomed in a democracy.'
Calling for change is the easy bit; agreeing on what actions are required will be harder; and implementing changes will be harder still. So I want to particularly single out Charlotte Cleal, who was one of those who addressed the crowd; because she made the most important point of the day: that the challenge we face, is the responsibility of us all - government, business and individuals. And she's right.
Politics and society across the world is polarised. We are all either pro-Trump or against him; we are all Leavers or Remainers; and there is a risk that climate change will similarly polarise. The movement led by Greta Thunberg, risks treating this issue as one of inter-generational conflict. But we are all responsible. The inconvenient truth, is that our children, who are among today's teenagers, have a larger carbon footprint than we did at the same age; and our carbon footprint is greater than that of my parents at the same age. And I also want to reassure Charlotte and others in her generation: there are many in her parents' and grandparents' generations who share their concerns and desire for action.
My objective this evening, is to set out how Guernsey can avoid that polarisation; and how we all - business, government and individuals - and whether we are climate change believers or sceptics - can work together to respond to the issue; but also how we can reposition Guernsey in the world, giving it an identity and purpose for the 21st century - which is the challenge Simon Anholt threw down at this event last year.
During June's debate on climate change as part of the update on the Future Guernsey Plan, the States rejected a call from Extinction Rebellion Guernsey and other external campaigners, to follow the UK and Jersey in declaring a 'climate emergency.' Instead, we passed a Resolution which recognised and I quote "that climate change has reached a critical point and that Guernsey must urgently address the climate and ecological crisis at both local and international levels."
I was one of those who disappointed those campaigners by rejecting their call for declaring an emergency but instead supporting that resolution. Not because I don't believe there is an existential threat - because, personally, I do, particularly to a small island community with limited high ground. I did so, because I don't believe in virtue signalling, empty rhetoric, when action is what is required.
So what actions should we take?
Guernsey is a community of 63,000 in a population of 7.7 billion. Our climate change contribution in relative global terms, amounts to 3/8ths of the square root of nothing. What on earth can Guernsey possibly do to assist? However virtuous we choose to be, it will make nodifference, so long as the Chinese build coal power stations and while the forests keep burning in Siberia, Africa, Asia and the Amazon. So it would be a perfectly rational policy choice to say, 'there is no point in Guernsey making any changes; we choose to do nothing.' Morally, that is not a policy choice I would wish to be part of. Neither would such a policy choice be consistent with our other policy positions. We regard ourselves as a responsible member of the comity of nations and the Future Guernsey Plan rightly has 'enhancing our position in the world' as one of our objectives. We can no more choose to stick two fingers up at the world on this issue, than we can on tax transparency. Change is happening globally. We can choose simply to follow it. We can be below the radar and move with the flow; we can wait to be dragged there by the rest of the international community; or, we can choose - as we have chosen on tax transparency - to step out in front and lead - and that is where the opportunity lies.
If Costa Rica, a middle income country, can commit to carbon neutrality by 2021, then Guernsey certainly has the capacity to up its ambition; if Kenya, a developing country, managed to ban plastic bags from her territory in 2017, then Guernsey can certainly do more to reduce our consumption of single use plastics.
To the climate change sceptics, I say this: if you are right and everyone else is wrong, no matter; the worst that can happen, is we'll have slightly better sea defences than we need; and we'll have more electric vehicles on our roads, more quickly than otherwise might have been the case. The upside is far greater than the downside. My key message tonight is that it doesn't matter whether you are a climate change believer (as I and a majority of the public are) or a sceptic. Either way, we have the same, once-in-a-generation opportunity for Guernsey to reposition and rebrand itself; and the responsibility rests on all of us (even if driven by different motivations - some virtuous, some cynical) to seize that opportunity. We must not drop that ball.
Why is there such a massive opportunity? The 2018 report of the Global Commission on the Economy and Climate conservatively estimated that globally, low carbon growth could deliver direct economic gain of $26trillion through to 2030.
As we know, our role in global capital markets is disproportionately large relative to our population, because of the scale of our financial services industry. The fact is that the scale of investment that is going to be required globally to fund the climate change actions and the decarbonisation of the global economy is huge. That will open up the chance for our industry to do what it does best - act as the conduit, the channel, the funnel between investors and the investment.
When it comes to our principal industry, financial services, we already have a strong story to tell. The world's first regulated green fund - thanks to the enterprise and foresight of our regulator, the Guernsey Financial Services Commission ('GFSC'); the growing profile of Guernsey Green Finance, thanks to the drive and dedication of Dr Andy Sloan and the political support from Deputy Lyndon Trott as Chairman of Guernsey Finance, and from Deputy Milly Dudley-Owen and our colleagues on the Committee forEconomic Development; membership of the United Nations' Financial Centres for Sustainability, an initiative triggered by an introduction made by Deputy Lindsay De Sausmaurez. We have green bonds on The International Stock Exchange, TISE GREEN; green insurance is next.
And only last week, we had the welcome news that the GFSC had secured membership of the Network for Greening the Financial System (NGFS.) Guernsey is the first international finance centre to achieve membership of the NGFS and I would like to commend the GFSC for their initiative.
I would also like to thank Marc Laine for the launch of Environmental & Social Impact Monitor and the opportunities it presents for our community and business. For those who you who don't know about it yet, it is a not-for-profit company set up to rate and accredit organisations for their commitment to the environment and the community. There will be significant reputational benefits if we demonstrate that we are monitoring the impact of what we do.
But. There is always a 'but.' It's not enough. To our many external critics and sceptics, this alone will be presented as, at best, 'green wash' and, at worst, the cynical commercial exploitation of the climate change agenda for our own benefit. As with tax co-operation and transparency, as with anti-money laundering, unfair though it is, we must accept that the standard, the bar is higher for us. We'll have little credibility with our external offer, green finance, if our internal policies are inconsistent. Our internal and external worlds are inextricably linked. The whole system, our whole culture needs to be consistent and needs to be aligned if we are to be credible. In short, we have to walk-the-walk as well as talk-the-talk.
So we need to think about the States' £3bn of investment portfolios - how do we achieve our investment objectives with an investment policy that is consistent with our community's climate change values and policy objectives? Perhaps we should join the United Nations Net-Zero Asset Owner Alliance - an initiative in which we could align with others to develop our portfolios and hold investments with net-zero emissions. How do we make funding available for climate change adaptation? This is an area we are giving some thought to ahead of the 2020 Budget next week - and we don't have all the answers. Perhaps we should seek to participate in the so-called 'COP26' - the UN's 26th Conference of the Parties - to be held in Glasgow next year? As an island, there will always be a need for air and sea travel; so perhaps we should develop a community carbon offset scheme, suitable for the needs of our own community; perhaps this could be dovetailed into our overseas aid work, so other poorer, more climatically vulnerable communities can benefit from our carbon offsetting. Should we do more to include environmental objectives, including the use of biofuels and offsetting, as part of Aurigny's shareholder objectives? Should we use the deep knowledge and experience of our trust sector to develop a 21st century concept of fiduciary duty in this area? How does our valued visitor sector dovetail into a low carbon economy and how can it help provide our shop window to world?
We have the pending energy policy, about which Deputy Barry Brehaut, the President of the Committee for theEnvironment & Infrastructure, will say more in a moment. I look forward also to a big, bold and ambitious Climate Change Action Plan from his Committee before next May, which was the timeline given in last June's climate change debate.
But an Action Plan is no more than a starting point. It is not an end-point. It will be the point at which we must decide to change the way we behave. To coin a relevant phrase, that will be when the rubber hits the road. So what will an Action Plan mean to us as a community? What decisions will we need to take? We in this room. Are the people in this room ready to change? Are you ready to lead change?
Are we ready to make the decisions that other places have made? To ban certain types of fuel, or new internal combustion engines. Do we want to structure and use a mileage charge - to be piloted as a replacement for fuel duty - as a tool to encourage or discourage particular vehicles or uses?
We want the convenience of the car - but are we prepared to give up road space for other users? For pedestrians, electric scooters or to accommodate safe bicycle lanes? The students who marched through the island last Friday are not just asking the States to do more. They are asking you to do more. They are your future employees, your future management, our island's future leaders. Is there enough leadership in this room tonight to demand and support some difficult decisions? Because they will be.
So what could the IoD do? Perhaps you could bring business together to develop that community carbon offset programme for Guernsey plc?
Barry, Lindsay, Milly, Lyndon, me - my colleagues in the States, our officers. We would all, I am sure, welcome such an initiative from industry, which could be a truly transformative part of the Action Plan that is being developed.
That is my challenge to you and the IoD tonight. Help Guernsey clean-up.
The States, of course, will need to play its significant part as policy setter. Whatever the Action Plan, we have to move faster than our system of government is normally used to. If we do not, our external critics will be given grist to their mill; our competitors will overtake us; and our public will, rightly, punish us. So whether I am a candidate in next June's election or not and, if so, whatever role I might have, if elected, my ambition is that the next government will move in this policy area (and indeed others) with greater alacrity.
But, finally, consider this. As we all know, Guernsey punches so far above its weight in so many areas. We see that in the work and dedication of our third sector; we see it on the sports field; we see it in the arts; and, of course, we see it with our finance industry. So too, could we see it in relation to the climate change agenda. The only limit is the scale of our own ambition. And as soon as we stop seeing it as burden, a drag, an expense; and instead embrace it as an opportunity, then not only can we unite behind the expeditious delivery of that ambition, but Guernsey can be seen as a leader and that can change the way the world sees us.
If we want the students here tonight and their generation to remain or return to the island, we need to respond to their expectation - and make the island a world leader that they are proud to call home; a place that their peers will have heard of and envy.
In five years' time, when we play word association, my ambition is that if I say 'Guernsey' these are the words will be associated with us:
I hope this can become a shared ambition. And I hope that that journey starts tonight.