"Portfolio Decarbonization." This nugget caught my eye as I scanned an article in the latest edition of Columbia Ideas at Work, entitled "Up in Smoke," and written by Patrick Bolton, Ph.D., the David Zalaznick Professor of Business at my graduate school alma mater, Columbia Business School.
Is this like pouring STP into my 401(K)? De-gunking my IRA?
Portfolio decarbonization is the hip, new term d'arte for selling your oil, gas, and coal stocks as a matter of environmental principle. Fossil fuels bad. Alternative fuels good. Wind, solar, geothermal, tidal: all good.
Thermal underwear, also not a bad idea. Come to think of it, I suggest investing in base layer, at least if you follow the performance-apparel industry. No kidding. Base layer is what used to be called long underwear. Warm skivvies to be worn underneath outer clothing on cold days. When I was a kid, I would wear long underwear to school beneath my flannel shirt and corduroys, to be ready to go ice skating once school let out for the day.
If you want to decarbonize your wardrobe, buy base layer made of organic marino wool. You'll stay warm, so, you won't need to turn up the heat. No burning of fossil fuels. And the Merino sheep won't mind the haircut. Bonus! Wool is a renewable resource, and if the sheep graze on organic grass, there's no petroleum-based fertilizer involved. What's not to like? The price. Sorry to spoil your day. Who wants to spend $150 on long underwear?
Back to portfolios. What to do, if anything? The enlightened investor knows instinctively that it's high time to divest anything with a carbon footprint bigger than a flip-flop made of recycled tires (alas, shipped to the U.S. from Vietnam on a huge container ship fueled with marine diesel, but, not to worry; most of us don't see that.)
I'm a practical-minded guy. I figure that the energy content and store-ability of fossil fuels will exceed that of alternative energy sources for some time to come. Nuclear power is also terrific, if you don't mind an occasional Chernobyl and don't live downwind of a tsunami zone. And don't worry about the Iranians, because their nuclear energy will be for peaceful purposes. The Iranians said so.
What I'm saying is, regarding portfolio decarbonization, no thanks. Mining and drilling and burning are human activities, and, being human, I don't mind a little environmental devastation, if the alternative is living in the dark, being cold (or hot), and chocking-off the fossil fuels on which humans still depend for survival.