Freddy that wiped out mining actitivites for 4 weeks. We would likely see a significant spike in price. Diverstification also would not likely save you given that the DRC also produces diamonds, gold, copper, tin, tantalum and lithium for global markets.


Conventional tools also ignore the increasing incidents of climate litigation against nation states and companies alike, only referring to changes in trade policy, not other types of legisltation which are climate driven and impact markets.


Since 2015, we have seen increasing law suits around the world, including the milestone ruling in April 2024 in The European Court of Human Rights4


quality of life, and put them at risk of dying. They won. Likewise, a suit brought to UK’s supreme court by activist groups5 demontsraiting failure of an oil exploration company to adequately account for their Stage 3 ESG impact resulted in the possible withdrawl of four oil and gas exploration licenses for the organisation.


A positive correlation between these law suits and implementation of stricter climate policies, which will affect sectors such as commodities, by nation states has been found in a global study of climate litigation6


. Likewise, law suits


against companies such as Shell and BP radically affected share price and investor sentiment. In its 20227


(ECHR)


in Strasbourg, France delivering its ruling in a case brought by more than 2,000 Swiss women, the majority in their 70s, against Switzerland’s government. They argued that climate change-fueled heat waves has undermined their health and


Figure 1. Drivers of commodity price volatility Demand


Geopolitcal events


Climate change


United States Trade policy Commodity price volatility Market transparency 300 Exchange Rate Supply Source: UNCTAD 200


Figure 2. Transmission channels of volatility in commodity-dependent developing countries


Growth volatility


trade volatility


Commodity price volatility


Revenue volatility


Capital flow volatility


Source: UNCTAD


Exchange rate volatility


Uncertainty


Slower growth


0 1990 1995 2000 2005 2010 2015 2020


Slower progress on the Goals


©nature *2023 data are incomplete. Terms-of-


Lower levels of investment


Lower levels of capital accumulation


150


Around two-thirds of the cases have been filed since 2015, the year of the Paris climate agreement.


100


Technological change


250 All other countries report,


the Intergovernmental Panel on Climate Change acknowledged for the first time that climate litigation can cause an “increase in a country’s overall ambition to tackle climate change”. So there is not a lot in UNCTAD’s report, as but one example, that can help us with the current types of volatility we face.


WHAT IS THE PROBLEM WITH NATURAL ASSET COMPANIES?


So with all of this emerging chaos, in September 14, 2021, NYSE announced “nature is a new asset class”. They valued Mother Earth at $US4,000 trillion natural asset valuation, producing $125 trillion in ecosystem services annually, or 450% of global GDP. This reality undermines economists like William Nordhaus, awarded the 2018 Nobel Prize in Economics for “integrating climate change into long-run macroeconomic analysis”, where he described a 4°C increase in global average temperature as “optimal” — that is, the point at which the costs and benefits of mitigating climate change are balanced. Especially given that just one of the climate indicators provided by the IPCC shows that we will have lost 80% of our oceanic ecosystems at 2 degrees. The math just doesn’t add up and shows the significant flaws in his assumptions of the nature of correlations between temperature and GDP.


CLIMATE CASES SOAR


More than 2,340 legal cases relating to climate change have been filed in courts since 1986. Lawsuits have been registered in 51 countries in all regions of the world.


50


14 | ADMISI - The Ghost In The Machine | Q3 Edition 2024


Number of climate-change cases


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