CLEAN AIR MAKES BUSINESS SENSE
How many billionaires would it take to save the planet? If a handful of the world’s richest people gave away their wealth, would that make a real impact on climate change? The question looks quite farfetched, especially in a global context where the United States, under the Trump regime, is not quite excited about the whole debate around climate change. But as an intellectual exercise, the Robin Hood index from Bloomberg is worth some bother.
The index calculated what slice of each top billionaire’s fortune would be needed to buy all the carbon credits required to offset all domestic greenhouse gas emissions in their home country over a year. Carbon credits are permits that allow a country or organisation to produce a certain amount of carbon emissions and can be traded if the full allowance is not used.
Mukesh Ambani, chairman and managing director of Reliance Industries, India’s largest company in the private sector, could use a part of his wealth to buy all the carbon credits required to offset all domestic greenhouse gas emissions in the country over a year. He would still have money to spare. Ambani has a net worth of $34.9 billion, according to Forbes. He needs to part with 72 per cent of his wealth to cover all the carbon credits in India.
Bill Gates needs to spend just 43.8 per cent of his wealth to do a similar exercise in the United States. In fact, in most countries, except China and Brazil, their top businessman can share a part of his wealth to buy off carbon credits in that country. In Brazil, investor Jorge Paulo Lemann’s $29 billion comes close to settling Brazil’s cleaning bill while in China, Alibaba Group’s Jack Ma would need to double his $37 billion to offset the damage caused by the world’s biggest polluter.
Carbon taxes don’t actually eliminate pollutants, however, by using carbon trading, countries set an outer limit on emissions and can either give rights to pollute or auction off some permits within the limit. Companies can then buy these credits, allowing them to pollute, or sell them, making a profit if they clean up.
The United States had pulled out of the Paris climate change agreement, which provides guidelines on pollution levels, posing new challenges for a global drive to control greenhouse emissions. Can businessmen turn Robin Hoods and come to the earth’s rescue? Interesting thought, but altogether in the realm of fantasy.
72 PER CENT of Mukesh Ambani’s $34.9 billion wealth would cover all the carbon credits in India