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Good Business: The Year Ahead in Sustainable Finance

An illustration made in Paris on November 8, 2015 shows an Earth globe made of glass and covered in blue liquid. Earth has heated up by one degree Celsius (1.6 degrees Fahrenheit), Britain's weather office said on November 9, as greenhouse gases hit record levels.

An illustration made in Paris on November 8, 2015 shows an Earth globe made of glass and covered in blue liquid. Earth has heated up by one degree Celsius (1.6 degrees Fahrenheit), Britain's weather office said on November 9, as greenhouse gases hit record levels.

Photographer: JOEL SAGET/AFP

Inside: Five trends to watch in 2020. Banks plans to go green still include oil and gas. The worst-case scenario for climate change doesn't look that realistic anymore.The machine silencing #MeToo on Wall Street.   — Emily Chasan

1) Going Green. Really Green.  
Energy stocks just haven't kept up with the broader market, which could push investors to look more closely at whether fossil fuels are really a worthwhile investments. Peak emissions aren't here yet, but they may be close. "Decarbonization is certainly dominating the conversation," says Bloomberg Intelligence analyst Eric Kane. A Stanford University study says phasing out fossil fuels and running the entire world on clean energy would cost $73 trillion but could pay for itself in under seven years.

Policy pressure will also play a role. Just ask Angela Merkel. After the COP 25 climate talks in Madrid did little to clarify how governments will pay for investments in climate adaptation and mitigation, they'll face even more pressure to ratchet up their commitments to reduce emissions in time for next year's COP 26 — the first year nations are expected to boost commitments under the Paris Agreement. Companies may have to accelerate their efforts in tandem, but still only 754 companies have made science-based targets to keep their emissions within a 2 degree global warming scenario. "Most organizations that have committed to science-based targets cannot articulate in detail how they are going to meet it, especially to 2050," said Bruno Sarda, president of CDP North America. "But if you set a goal that's 30 years out and you already know how to meet it, then that's not a good enough goal."