Roses are red, violets are blue. I love climate-aligned financial regulations, and you should too.
You have a relationship with your bank and pension, but the way they are managing your money might not be in the best interest of you or the climate. Maybe it’s started to grind your gears. This Valentine’s Day, we ask: how can we fix the broken relationship between financial institutions and climate action, so you can feel good about your bank again?
Luckily for us, we have the best couples therapist in town: financial regulation.
Let’s break down some common relationship problems, and how financial regulation can help fix them.
1. My bank keeps going behind my back with the fossil fuel sector
The financial sector has somewhat of an sordid affair with the fossil fuel industry. For every dollar that you put in your bank account, or toward insurance, or into saving for the future, the financial industry gives some of that to the fossil fuel industry. You think you and your bank are saving for a safe future together, but really they’re going behind your back and making the future worse by investing in the climate crisis.
Thankfully, climate-aligned financial regulation would bring transparency about where banks and pensions are putting your money, and encourage them to set real plans to reduce their polluting investments. No more secrets.
2. My financial institution is saying one thing, but doing another
Many so-called ‘sustainable investments’ are actually used to finance oil and gas production. All good relationships should be built on trust and honesty, so setting ground rules for communication is important. A clear and agreed-upon definition of what ‘sustainable’ means could ensure your bank or pension is actually sticking to its green commitments.
Financial regulation can rebuild trust by providing these clear definitions. Otherwise, financial institutions will continue to greenwash by passing off investments in oil and gas as sustainable.
3. My financial institution engages in risky behavior that threatens a climate safe future
Driving fast cars, jumping out of planes and gambling may look cool online, but do you really want to be settling down with someone that takes unnecessary risks? We all want a reliable partner that can weather the storms of life. Literally.
As climate change produces more and more extreme weather events, we need a financial institution that is sensible enough to come out unscathed. Canada has $100 billion of fossil fuel assets at risk of losing value, while insurance providers are having to pay out billions of dollars annually in climate-related damages.
Financial regulation will require financial institutions to properly understand the risks of climate change, and plan for them. It will guide them to proactively invest in climate resilience and solutions, instead of making the crisis worse.
4. My financial institution keeps putting short-term profit over our safe future
It’s important to know what each party’s priorities are in a relationship, and find alignment. It’s also important to be able to plan for the future. Sure, it’s fun to splash the cash on a night out on the town, but relationships are also about planning for the future, not just seeking rewards in the immediate moment.
Hard truth time – the number one priority of your financial institutions is not you – or a safe and liveable planet – it’s short-term profit. Thankfully, financial regulations can provide some oversight and set some clear boundaries so that you and our collective future are the priority, not short-term profit. Financial regulations will require financial institutions to take climate change seriously, and put money into making the future safer and move livable, not just whatever turns a profit soonest.
Your relationship with the financial sector might feel a little broken right now, but it doesn’t have to stay this way forever. Our favourite couples therapist, financial regulation, can help us sort out the mistrust, missteps and misalignments. On this most romantic of days, it’s worth putting a little time into fixing our relationship with finance.
Ask your elected official to regulate finance now, so that next Valentines day, our relationship with the financial sector can be a happier one.