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Our views 02 October 2019

RLAM supports a Just Transition to low-carbon society

By Carlota Garcia-Manas, Senior Responsible Investment Analyst

5 min read

RLAM has signed the Statement of Investor Commitment to Support a Just Transition on Climate Change. A statement endorsed by 143 investors representing US9.

1 trillion in AUM (source:

As an environmental economist (and engineer) by academic background it has always fascinated me how modernity could be so inefficient and cumulate so many externalities.

Against a backdrop of wealth creation and lifting of many layers of society away from poverty, the industrial revolution brought along many ills.

River pollution, health impact of urban air, economic inequality and the human contribution to climate change contrast with the many benefits of economic development including an increased life span, access to electricity, heating and sanitation.

As the governments of the world continue grappling with the necessary requirements to reverse the cumulative impact of economic development, the question of inequality and social externalities becomes more pressing, as we’ve seen with the gilets jaunes movement. 

Investors care about these issues because their beneficiaries do. 

The voices of current savers, and more importantly, future ones are being heard loud and clear. During the climate strikes in September 2019, protests took place across 4,500 locations worldwide, with around four million people taking part, according to organisers 

Future generations have found a common voice. They are not voters yet, they are not workers yet, but they do not want to let the inaction of part and current generations increase cumulative consequences to a point where this has a ruinous effect on their future. The messages of extinction, ruined futures and climate crisis are dramatic. Yet, the sobering truth is that there is a growing appetite for change, especially amongst the young. Political classes have now their work cut out for them to organise the required political and fiscal frameworks to do this in the most equitable, orderly way possible.

Just transition was a request in the Paris Agreement signed in 2015. It represents an effort to pre-empt social externalities associated with the tackling of the environmental externalities generated by development.

The quest is complicated. Jobs are not just displaced by the energy transition, they are destroyed by technology, resource depletion, migrations, de-skilling. The task at hand for both governments and economic actors is clear. Evaluate, prepare, consult, and integrate social factors so that in transitioning to a cleaner future, the poorest and most vulnerable in society are not left behind.

RLAM, as signatory to the Just Transition investor statement is committed to pursue its mission and make sure that in our engagement going forward, we take into consideration the most vulnerable in society.

Past performance is not a reliable indicator of future results. The value of investments and the income from them is not guaranteed and may go down as well as up and investors may not get back the amount originally invested. The views expressed are the author’s own and do not constitute investment advice. Portfolio holdings are subject to change, for information only and are not investment recommendations.