Dr. Guy Wolf, Global Head of Market Analytics at Marex, spoke with John Lothian News at FIA Expo 2022 about ESG – particularly the environmental part.  He said Marex is looking to be carbon neutral this year and has invested in a mangrove restoration and reforestation project in Indonesia to offset its own footprint.  Becoming carbon neutral is also critical for the company’s clients, who are heavily involved in commodities. 

“Commodities are a key part of the green transition,” Wolf said. “Fossil fuels are what we need to transition away from, but a lot of base metals are in the components needed to create electric vehicle factories and other renewable technologies. So it’s an enormous structural change for our company and the industry.”

Marex helps its clients by providing solutions that facilitate access to voluntary offset markets, he said. It is also helping to promote new technologies. For example, the company is working with the University of Oxford to create a methodology for a science-based, technology-driven assessment of carbon using high resolution satellites that can monitor tens of thousands of hectares in one go, which is a lot more scalable and faster and more accurate than some of the existing technologies. 

In the UK, there are legal requirements now about reporting your carbon footprint, he said. But regardless of legislation, market pressure and media pressure mean large companies can’t ignore the green transition. 

He said a lot is being accomplished and a huge amount of money is being put into reducing carbon footprints. 

“People complain about China, for example, but the carbon footprint for producing aluminium in China has dropped in the last 10 years from 30 tons of carbon per ton of aluminium to 12 tons,” he said.  “So there have been real advances. I think it’s much less of a problem than people think,” he said. 

One of the challenges for the carbon market has been the blurring of ESG lines into one single thing, Wolf said. The social impact of giving people in Africa cookstoves, for example, is a worthy project but is not the same as removing carbon from the atmosphere. 

“In a sense the carbon market has created a problem for itself by blurring social benefits with carbon credits. Better to have carbon as a science-based metric and then social benefits as something valued separately,” he said.

We asked him if there was a letter missing in “ESG.”  He said, “Integrity.”

“Ultimately it’s about whether companies pursue these goals with integrity,” he said.