THE ROLE OF THEFINANCIAL MARKETS

Idar Kreutzer CEO Finance Norway

A changing global marketplace

2

Ecological estimates: Getting to one planet by the end of the 2050s

Vision 2050 ecological footprint against business-as-usual How many Earths do we use?

Source: Global Footprint Network and WBCSD Vision 2050, 2010

2.3 Earths (BAU)

1.1 Earths (Vision 2050)

0

0.5

1

1.5

2

2.5

1960 1970 1980 1990 2000 2010 2020 2030 2040 2050

Num

ber

of E

arth

s

Year

Carbon footprint

Cropland

Grazing land

Forest

3

”Those companies that

wait to be forced into

action or who see it solely

in terms of reputation

management or CSR, will

do too little too late and

may not even survive.”

Paul Polman, CEO Unilever

Increasing complexity

of risk

Changing consumer behavior

Business

Evolving framework conditions

Rising cost of capital

Fluctuating prices and

availability of raw materials

Source: World Business Council for Sustainable Development, Vision 2050

Business models need to be adjusted

4

Environment

Economy

Society

Sustainablevalue

creation

A sustainable business model

5

Cost of capital – investor perspective

The TIP-factors

Technologial change

Impacts

Policy

”These risk factors will be

priced by the capital market

on the same terms as more

traditional risk factors”

(Mercer/Norges Bank)

6

The strategic business perspective

• Goals • Key drivers

• Consumer behaviour• Competitor behaviour• Risk management• Innovation• Cost of capital – investors• Reputation

1. Reverse the trends

2. Manage the consequences

7

Building & transforming…

a. Citiesb. Infrastructure

c. Livelihoods & lifestyles

Helping change happen

Improving biocapacity &

managing ecosystems

Business domains for the next decade – Opportunities and overlaps

8

9

The fundamental risk

“There are risks and costs to action. But

they are far less than the long range costs of comfortable inaction”.

John F. Kennedy