Drawdown means business

August 27, 2019

The Business Case for Investing in Drawdown

Climate change is real and man-made. Worse, as emissions approach a critical level, nature’s heroic efforts to sequester carbon and other harmful gases start to fail and the process speeds up.  

Yes, at other points in our planet’s evolution the climate has changed independently of human action.  However, that’s no argument for denying the impact of excessive human greed and short-term political agendas on planetary boundaries. It’s like denying hydroponics because nature grows things anyway, or not believing airplanes and birds can exist at the same time.  

Anyway, we have a problem and the solution - while possible - requires cooperation amongst self-serving political representatives, vested interests, and people who place a higher value on comfort and convenience than the long-term survival of the human race.  


Actually, that last bit wasn’t completely fair because there are bigger forces at work than mere selfishness or stupidity, although – those too.  Garrett Hardin described it as the ‘tragedy of the commons’, which basically describes the systemic disincentive for individuals to preserve natural ‘shared’ resources when they know the next guy will grab whatever they try to preserve.

That’s why any workable solution to the climate change problem must include government policy, to create a level playing field for doing the right thing.

Viewed from a certain perspective, humans can be compared to a nasty parasite planet earth picked up and hasn’t yet been able to shake, or perhaps a fast-spreading bacterium that eventually kills off its host. From a more loving and hopeful perspective, however, humans are capable of great acts of cooperation and world-changing innovation.  It’s this second perspective that has the potential to safeguard our world for future generations.

For example: There are a growing number of promising and cost-effective solutions to not only reduce emissions but also draw down climate-heating emissions  from our atmosphere.  

From the New York Times bestseller DRAWDOWN: The Most Comprehensive Plan Ever Proposed to Reverse Global Warming, here are our top picks at Red Rocks Impact, featured in our portfolio strategy because they not only have a big impact but also produce an attractive return and/or create exciting new investment opportunities:

Here is a sector view, which is interesting because it highlights the biggest culprits and impact opportunities. As you can see, the impact opportunity for transportation and construction are comparatively low, compared to agriculture and energy.  

Bottom line: Implementing all of the solutions in the DRAWDOWN book would cost each person on the planet about $450 a year.  That’s a lot for some but the top <1% most wealthy family offices could pay for the entire thing while remaining fabulously, insanely, unimaginably rich. Moreover, a growing number of high net worth individuals and family offices are ready to support these solutions if they are well-managed and accountable.

Best of all, these solutions will save way more than they cost. They make good economic sense.

Clearly, money’s not the real problem, politics, inertia, and vested interests are. Impact investors are working to help give innovative new solutions a chance to become mainstream, but there’s so much more to do.  

You can read more about impact investing here and our Red Rocks impact investment strategy here.

Laura Schroeder

Making money do more....