Finance and the Earth system – exploring the links between financial actors and non-linear changes in the climate system

Financial actors and capital play a key role in extractive economic activities around the world, as well as in current efforts to avoid dangerous climate change. Here, in contrast to standard approaches in finance, sustainability and climate change, we elaborate in what ways financial actors affect key biomes around the world, and through this known "tipping elements" in the Earth system. We combine Earth system and sustainability sciences with corporate finance to develop a methodology that allows us to link financial actors to economic activities modifying biomes of key importance for stabilizing Earth's climate system. Our analysis of key owners of companies operating in the Amazon rainforest (Brazil) and boreal forests (Russia and Canada) identifies a small set of international financial actors with considerable, but as of yet unrealized, globally spanning influence. We denote these "Financial Giants", and elaborate how incentives and disincentives currently influence their potential to bolster or undermine the stability of the Earth's climate system

Leverage points in the financial sector for seafood sustainability

Can finance contribute to seafood sustainability? This is an increasingly relevant question given the projected growth of seafood markets and the magnitude of social and environmental challenges associated with its seafood production. As more capital is injected into the seafood industry, it becomes crucial that such investments steer the sector towards improved sustainability, as opposed to fueling unsustainable working conditions and overexploitation of resources. Using a mixed-methods approach, we map where different financial mechanisms are most salient along a seafood firm’s development trajectory and identify three leverage points for sustainability that can redirect capital towards more sustainable practices: loan covenants, stock exchange listing rules and shareholder activism. Our results show that although they hold great promise for transformative capacity, this potential is currently unlikely to be realized due to limited social-ecological awareness within the finance industry. We argue that seafood sustainability requirements need to be integrated into traditional financial services and propose key research avenues for both the academic and the policy community. While our study focuses on the role of finance in seafood sustainability, the insights developed throughout are of high relevance to other extractive industries as well

Income distribution and inequality among fishers and fish traders in two small-scale Kenyan coral reef fisheries

Since the mid-1960s fish production has become increasingly market-driven with actors downstream in the commodity chain increasingly determining the price of fish. Previously, it has been shown that fishers' incomes tend to be low in both developed and developing countries and that linking fisheries to global markets causes income inequalities. Research has also shown that although many factors affect the sustainability of any individual fishery, income inequality and the struggle for food security are significant contributors, particularly in developing countries. Despite awareness of the link between poverty and resource exploitation, the distribution of benefits derived from fish trade remains poorly understood. This study, carried out in five small-scale coral reef fishing communities along the Kenyan coast, sought to explore this link and in so doing found that both fishers and traders engaged in a more globally integrated fishery received higher incomes. There was no evidence that greater global market integration causes higher income inequalities within a fishery, an indication that linking local fisheries to global markets has potential positive income effects. We recommend disaggregated analyses in future studies of fishery income distribution in order to properly inform interventions within the context of specific fishery resource and respective market characteristics.Keywords: Markets and Trade, Fisheries Economics, Globalisation and Trad

Unlocking the unsustainable rice-wheat system of Indian Punjab: Assessing alternatives to crop-residue burning from a systems perspective

Crop residue burning in Indian Punjab emits particulate matter with detrimental impacts on health, climate and that threaten agricultural production. Though legal and technological barriers to residue burning exist – and alternatives considered more profitable to farmers – residue burning continues. We review black carbon (BC) emissions from residue burning in Punjab, analyse social-ecological processes driving residue burning, and rice and wheat value-chains. Our aims are to a) understand system feedbacks driving agricultural practices in Punjab; b) identify systemic effects of alternatives to residue burning and c) identify companies and financial actors investing in agricultural production in Punjab. We find feedbacks locking the system into crop residue burning. The Government of India has greatest financial leverage and risk in the current system. Corporate stakeholders have little financial incentive to enact change, but sufficient stakes in the value chains to influence change. Agricultural policy changes are necessary to reduce harmful impacts of current practices, but insufficient to bringing about sustainability. Transformative changes will require crop diversification, circular business models and green financing. Intermediating financial institutions setting sustainability conditions on loans could leverage these changes. Sustainability requires the systems perspective we provide, to reconnect production with demand and with supporting environmental conditions

Unlocking the unsustainable rice-wheat system of Indian Punjab : assessing alternatives to crop-residue burning from a systems perspective

This work was funded by Formas (Project # 2018-01824), and through the generous support of the Erling-Persson Family Foundation to the Global Economic Dynamics and the Biosphere, the Royal Swedish Academy of Sciences, Sweden.Crop residue burning in Indian Punjab emits particulate matter with detrimental impacts on health, climate and that threaten agricultural production. Though legal and technological barriers to residue burning exist – and alternatives considered more profitable to farmers – residue burning continues. We review black carbon (BC) emissions from residue burning in Punjab, analyse social-ecological processes driving residue burning, and rice and wheat value-chains. Our aims are to a) understand system feedbacks driving agricultural practices in Punjab; b) identify systemic effects of alternatives to residue burning and c) identify companies and financial actors investing in agricultural production in Punjab. We find feedbacks locking the system into crop residue burning. The Government of India has greatest financial leverage and risk in the current system. Corporate stakeholders have little financial incentive to enact change, but sufficient stakes in the value chains to influence change. Agricultural policy changes are necessary to reduce harmful impacts of current practices, but insufficient to bringing about sustainability. Transformative changes will require crop diversification, circular business models and green financing. Intermediating financial institutions setting sustainability conditions on loans could leverage these changes. Sustainability requires the systems perspective we provide, to reconnect production with demand and with supporting environmental conditions.Publisher PDFPeer reviewe

Accounting and accountability in the Anthropocene

This research received funding from the Walton Family Foundation (2017-693, 2018-1371), the David and Lucile Packard Foundation (2017-66205, 2019-68336), and the Gordon and Betty Moore Foundation (5668.01).Purpose: This paper aims to interrogate the nature and relevance of debates around the existence of, and ramifications arising from, the Anthropocene for accounting scholarship. Design/methodology/approach: The paper’s aim is achieved through an in-depth analysis of the Anthropocene, paying attention to cross disciplinary contributions, interpretations and contestations. Some points of connection between the Anthropocene and accounting scholarship are then proposed and illuminated through a case study drawn from the seafood sector. Findings: This paper develops findings in two areas. First, there are suggestions about how accounting scholarship might be further developed by the provocation that thinking about the Anthropocene provides. Second, we suggest new accounting research findings, through engagement with the case study, and propose that the concept of stewardship may re-emerge in discussions about accountability in the Anthropocene. Research limitations/implications: The paper argues that accounting scholarship focused on social, environmental and sustainability concerns may be further developed by engagement with Anthropocene debates. Practical implications: While accounting practice might have to change to deal with Anthropocene induces effects, this paper focuses on implications for accounting scholarship. Social implications: Human wellbeing is likely to be impacted should environmental impacts accelerate. In addition, an Anthropocene framing alters the understanding of nature-human interactions and how this affects accounting thought. Originality/value: This is the first paper in accounting to seek to establish connections between accounting, accountability and the Anthropocene.Publisher PDFPeer reviewe

Towards greater transparency and coherence in funding for sustainable marine fisheries and healthy oceans

This final manuscript in the special issue on “Funding for ocean conservation and sustainable fisheries” is the result of a dialogue aimed at connecting lead authors of the special issue manuscripts with relevant policymakers and practitioners. The dialogue took place over the course of a two-day workshop in December 2018, and this “coda” manuscript seeks to distil thinking around a series of key recurring topics raised throughout the workshop. These topics are collected into three broad categories, or “needs”: 1) a need for transparency, 2) a need for coherence, and 3) a need for improved monitoring of project impacts. While the special issue sought to collect new research into the latest trends and developments in the rapidly evolving world of funding for ocean conservation and sustainable fisheries, the insights collected during the workshop have helped to highlight remaining knowledge gaps. Therefore, each of the three “needs” identified within this manuscript is followed by a series of questions that the workshop participants identified as warranting further attention as part of a future research agenda. The crosscutting nature of many of the issues raised as well as the rapid pace of change that characterizes this funding landscape both pointed to a broader need for continued dialogue and study that reaches across the communities of research, policy and practice.S

Financing a sustainable ocean economy

The ocean, which regulates climate and supports vital ecosystem services, is crucial to our Earth system and livelihoods. Yet, it is threatened by anthropogenic pressures and climate change. A healthy ocean that supports a sustainable ocean economy requires adequate financing vehicles that generate, invest, align, and account for financial capital to achieve sustained ocean health and governance. However, the current finance gap is large; we identify key barriers to financing a sustainable ocean economy and suggest how to mitigate them, to incentivize the kind of public and private investments needed for topnotch science and management in support of a sustainable ocean economy

Our future in the Anthropocene biosphere

The COVID-19 pandemic has exposed an interconnected and tightly coupled globalized world in rapid change. This article sets the scientific stage for understanding and responding to such change for global sustainability and resilient societies. We provide a systemic overview of the current situation where people and nature are dynamically intertwined and embedded in the biosphere, placing shocks and extreme events as part of this dynamic; humanity has become the major force in shaping the future of the Earth system as a whole; and the scale and pace of the human dimension have caused climate change, rapid loss of biodiversity, growing inequalities, and loss of resilience to deal with uncertainty and surprise. Taken together, human actions are challenging the biosphere foundation for a prosperous development of civilizations. The Anthropocene reality—of rising system-wide turbulence—calls for transformative change towards sustainable futures. Emerging technologies, social innovations, broader shifts in cultural repertoires, as well as a diverse portfolio of active stewardship of human actions in support of a resilient biosphere are highlighted as essential parts of such transformations. © 2021, The Author(s)