Can Jeff Bezos’s $10 Billion Climate Pledge Make a Difference?
This week, Amazon CEO Jeff Bezos announced that he would spend $10 billion to combat the climate crisis, by funding “scientists, activists, NGOs—any effort that offers a real possibility to help preserve and protect the natural world.” We asked Todd Cort, co-director of the Yale Center for Business and the Environment and an expert on sustainable finance, if Bezos’s money was a significant step toward a solution.
Is Jeff Bezos’s pledge of $10 billion to fight climate change significant, either in terms of scientific impact or public perception?
Is it significant? Yes. Just in terms of dollar value, it appears to be an order of magnitude greater than donations to nonprofits globally for fighting climate change. So as an input into solving the challenge it is very significant. When we compare it to the needed outcomes, it is a drop in the bucket. Estimates of the needed investments to curb climate change impacts and emissions are around $100 billion per year. So meeting the need requires an additional order of magnitude in multiplier effects.
Can $10 billion of funding for various NGOs and scientists make a difference?
Yes. I am very much a proponent that solving climate change requires “a village.” That is, everyone must move in the same direction and only through collective action do we make progress. This is moving in the right direction. NGOs and scientists are part of that collective effort and so I have no problem with that direction of focus.
I think that there are some levers of action that will have larger multiplier effects than others. Take scientific research, for example. The physical science of climate change, while needing continued refinement, is more or less established. Adding to that physical science literature is unlikely to convince more people of the fact of climate change and the need for action. It may be more impactful to target economic, political, and social science, due to their larger potential to lever the money toward greater action.
If you had $10 billion to combat climate change, how would you spend it?
There are lots of interesting and effective ways to invest in climate solutions. For example, some have argued that Bezos should use that money to instead invest on Amazon.com’s carbon emissions. My sense is that there are several big buckets of activity and within each of these buckets are critical elements that need investment. For example, corporate activity on climate change is an important bucket and within that financial disclosure of climate risk would be a game changer. So focus on regulations coming out of the Securities and Exchange Commission. Investment in green infrastructure is a big bucket, and within that artificial intelligence applications to create more resilient infrastructure planning would be an enormous lever. Public-private partnerships is a big bucket to reduce emissions and within that there is a critical need for new metrics that measure performance across systems rather than individual companies and contracts.