Understanding the Climate Debt of Extreme Wealth
A very small group of ultra-wealthy individuals is associated with disproportionate costs of climate harm, driven alarmingly by their ownership of and investments in high-emitting activities alongside their carbon-intensive lifestyles, a new Greenpeace Africa report revealed.
The report illustrates (in $) the sheer enormity of this climate responsibility and the huge concentration by the world’s ultra-wealthy, suggesting this should factor into the debate on ‘who should pay’ for the climate crisis.
In 2022, the investments of the world’s richest 0.01% were associated with an estimated US$992 billion in what the report describes as climate debt – the monetised climate damages associated with emissions exceeding an equitable share of the remaining carbon budget consistent with a 1.5°C pathway. By comparison, the report estimates the consumption-based climate debt of the world’s richest 0.01% at US$405 billion in 2022.
Key takeaways from the report:
- Climate debt is highly concentrated at the very top of the global wealth distribution. As wealth concentration increases, so too does the scale of associated climate debt.
- Ownership-based emissions – those linked to investment portfolios and capital holdings – are considerably more concentrated among the wealthiest groups than consumption-based emissions, highlighting the growing role of capital ownership and investment structures in driving highly unequal climate responsibility.
- Ownership-based climate responsibility and extreme wealth concentration are heavily concentrated among wealthy groups and some jurisdictions, while the countries facing the greatest climate vulnerability, climate damage, or climate finance needs are often located elsewhere.
Greenpeace International is calling on governments to integrate the polluter-pays principle into climate and fiscal policy frameworks and to commit under the UN Tax Convention (UNFCITC) to effective taxation of ultra-high-net-worth individuals and major corporate polluters, including through legally binding rules on taxing rights, transparency and measures to combat tax abuse.
As climate finance needs continue to grow, discussions under the United Nations Framework Convention on Climate Change (UNFCCC) and the UN Tax Convention should increasingly be seen as complementary processes to help mobilise the resources needed for climate action and sustainable development.
- REPORT “Understanding the climate debt of extreme wealth” – DOWNLOAD HERE
- You can also read executive summary here.
