The same is true of the world of business, as demonstrated by my go-to example WH Smith. To manage its exposure to the double whammy of shoppers shifting online and the decline of print, it turned to cost-cutting, one important aspect of which was to make its stores more energy efficient, with millions saved by switching to LED lighting alone. Modern buildings can save money, too – take Adnams, a company I admire for several reasons, as an example; its Suffolk distribution centre boasts the UK’s largest sedum roof and thus costs nothing to heat, helping reduce the brewer’s energy bills by £50,000 a year. And there are plenty of listed companies set up to help others manage this worthwhile – and worthy – process, such as Utilitywise (which pops up in this week’s High Yield Small Cap stock screen) or Smart Metering Systems (in the cover feature) or infrastructure trusts such as Tri-Pillar.
Yet investors have been slow to wake up to the changes taking place, perhaps because the problem does not really feel like a pressing one, or maybe even because there is a mistrust of the idea that man-made climate change is real and needs to be managed. At an institutional level that is now changing, as witnessed by the huge inflows into environmental strategies offered by asset management groups such as Impax, and the changing course of large oil-rich economies such as Norway and Saudi Arabia. But such moves are less about changing – or protecting – the world than about protecting wealth, a similar motive to the investment in clean energy technology championed in the government’s new industrial strategy launched this week. And that is also how private investors should think about investing in renewable technology – even if you think the future reality of climate change is overstated, the renewable tide will not be retreating. Remain a denier at risk to your wealth.
