Michael Kent

Michael Kent

San Francisco, California, United States
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Michael is Partner at New Leaf Climate Partners, an investment and advisory firm he…

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  • New Leaf Climate Partners Graphic

    New Leaf Climate Partners

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    San Francisco, California, United States

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    San Francisco, California, United States

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    San Francisco Bay Area

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    Greater New York City Area

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    San Francisco

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    Redwood City

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Education

Licenses & Certifications

  • Series 63

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    Issued

  • Series 7

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    Issued

Publications

  • Time to clean up greenwashing: How to make climate funds less fancy

    ClimateWorks

    The financial sector plays a critical role in creating our net zero future. But the lack of transparency with climate funds stymies progress. Regulators can instill confidence in the market starting with these three steps.

    See publication

  • Virus-Hit Cities in Hurricane Zone Get Moody’s Warning on Risks

    Bloomberg

    BlackRock, the word’s largest asset manager, said in a May 30 report that investors “must consider the added risk of climate change” since it poses a “dual threat” to places and counties already struggling to recover from the pandemic.

    By using climate data assessment, the firm found some counties are exposed to annualized gross domestic product losses up to 2.5% over the next 10 years above the GDP forecast without any pandemic risk. That leads to the risk for rising bond yields ranging…

    BlackRock, the word’s largest asset manager, said in a May 30 report that investors “must consider the added risk of climate change” since it poses a “dual threat” to places and counties already struggling to recover from the pandemic.

    By using climate data assessment, the firm found some counties are exposed to annualized gross domestic product losses up to 2.5% over the next 10 years above the GDP forecast without any pandemic risk. That leads to the risk for rising bond yields ranging from 25 to 80 basis points, depending on the speeds of their recoveries, according to the firm’s report. The areas that are exposed to both climate change and pandemic risk will see worse losses.

    For example, Miami-Dade County in Florida is forecast to see 0.88% annualized loss of GDP over the next 10 years due to Covid exposure, according to BlackRock’s estimates. That projected loss jumps to a combined 2.6% annualized loss when hurricane exposure is taken into account.

    “Local finances become even more dire after considering the potential for climate change related risks over the next decade,” wrote BlackRock’s Amit Madaan and Michael Kent.

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  • Dual Threats: COVID and Climate Change

    BlackRock

    The COVID-19 pandemic is exhausting local finances and may impact growth trajectories for years to come. As of mid-April, states and municipalities will need at least $500 billion in aid to shore up balance sheets as demand for services intensifies and tax revenue plummets, according to the National Governors Association. At the same time, hurricane season – and the economic havoc it wreaks – is officially upon us.

    To understand the implications of this dual threat, we have combined our…

    The COVID-19 pandemic is exhausting local finances and may impact growth trajectories for years to come. As of mid-April, states and municipalities will need at least $500 billion in aid to shore up balance sheets as demand for services intensifies and tax revenue plummets, according to the National Governors Association. At the same time, hurricane season – and the economic havoc it wreaks – is officially upon us.

    To understand the implications of this dual threat, we have combined our local economic coronavirus impact modeling with our climate change risk assessments. We find, regrettably, that:

    -Hurricane damage is expected to produce a negative local GDP impact along the Gulf Coast and Atlantic Basin ranging up to 1.9% annualized GDP loss over the decade
    -Some of the regions hardest hit by the pandemic may also have the greatest exposure to hurricane risk and costs from wind and flooding damage. For example, we estimate Miami-Dade County with a joint COVID/Climate annualized loss of 2.6% to 2030
    -Even those counties with relatively muted GDP impacts from COVID may face more significant losses after factoring in climate risks.

    As investors navigate the uncharted waters of COVID-19 and look ahead, we recommend that they, too, bear in mind this dual threat of climate change.

    See publication

  • 3 tips for investing in the low-carbon transition

    BlackRock

    We’ve read the headlines. Extreme weather events from wildfire to floods are forcing governments and companies around the world to consider climate-related risks as they plan for the future. Reducing greenhouse gas (GhG) emissions has been central to these plans and is already under way. According to the Global Carbon Project, the U.S. has seen GhG decline by 0.8% annually from 2013 to 2018, as it turns away from coal power to natural gas and renewable energy sources. This mirrors the downward…

    We’ve read the headlines. Extreme weather events from wildfire to floods are forcing governments and companies around the world to consider climate-related risks as they plan for the future. Reducing greenhouse gas (GhG) emissions has been central to these plans and is already under way. According to the Global Carbon Project, the U.S. has seen GhG decline by 0.8% annually from 2013 to 2018, as it turns away from coal power to natural gas and renewable energy sources. This mirrors the downward trend in Europe, with numbers in both regions estimated to jump lower in 2019 as well.

    Despite some signs of improvement, there is still great need to reduce emissions globally to combat the threats of climate change, particularly in emerging markets. For example, China and India have been increasing emissions, leading to a still growing – but slowing – global concentration of greenhouse gases. Nonetheless, we believe the recent emissions reduction trajectory in developed markets is a sign of things to come worldwide. As we wrote in our recent Carbon Beta blog, we see budding appetite for carbon pricing regulation as a key accelerator of this transition, with Europe leading in the near-term.
    So, with a global energy shift underway across countries and sectors, there are clearly investment implications throughout your portfolio. How should you factor that into your allocation strategy?

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  • Introducing Carbon Beta: What pricing carbon means for investors

    BlackRock

    Investors already know that the transition to a low-carbon economy matters to their portfolios. But measuring how it matters has been incredibly difficult – until now. In order to answer this pressing question, BlackRock Sustainable Investing has developed a new cutting-edge investment metric called Carbon Beta. Simply put, it’s a way of measuring a company’s sensitivity to carbon prices.

    Carbon Beta, which is integrated into our risk and investment management technology Aladdin, is…

    Investors already know that the transition to a low-carbon economy matters to their portfolios. But measuring how it matters has been incredibly difficult – until now. In order to answer this pressing question, BlackRock Sustainable Investing has developed a new cutting-edge investment metric called Carbon Beta. Simply put, it’s a way of measuring a company’s sensitivity to carbon prices.

    Carbon Beta, which is integrated into our risk and investment management technology Aladdin, is designed to help investors better understand the energy transition. Using Carbon Beta, every portfolio manager at BlackRock can review the impact of future carbon price scenarios on their investment portfolios. This enables us to better understand the risks and opportunities of carbon pricing and deliver our clients solutions aligned with the low-carbon transition.

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  • Carbon Beta - A Framework for Determining Carbon Price Impacts on Valuation

    Social Science Research Network

    Greenhouse gas (GHG) emissions create a cost liability for firms exposed to the implementation of carbon pricing. We propose a framework for public equities that links Scope 1 and Scope 2 emissions with changes in firm valuation. This framework considers both 1) larger operating costs that lead to a decrease in value as well as 2) new revenues generated by “green” sales that increase the value of firms. From an initial carbon tax “shock”, we distribute the tax costs across market sectors based…

    Greenhouse gas (GHG) emissions create a cost liability for firms exposed to the implementation of carbon pricing. We propose a framework for public equities that links Scope 1 and Scope 2 emissions with changes in firm valuation. This framework considers both 1) larger operating costs that lead to a decrease in value as well as 2) new revenues generated by “green” sales that increase the value of firms. From an initial carbon tax “shock”, we distribute the tax costs across market sectors based on Scope 1 emissions and estimate higher electricity costs based on Scope 2 emissions. In addition, we consider an increase in revenues for companies generating solutions for mitigation of GHG emissions. The framework relies on a host of assumptions that we outline and test through sensitivity analysis. We find negative price responses in four sectors: Energy, Utilities, Materials and Transportation, while we find positive price responses in several sectors including Automobiles, Software and Capital Goods.

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  • Investing in the Transition to a Low Carbon Economy: Exploring the Link Between a Company's 'Transition Readiness' and Financial Performance

    Social Science Research Network

    This paper describes a new investment framework to assess public companies’ “Transition Readiness”, or preparedness for a transition to a global low-carbon economy. Unlike prior low-carbon research that focuses on carbon emissions as a source of potential risk, this five-part framework is designed to capture both a company’s potential risks and opportunities associated with the transition. We construct the Transition Readiness framework on a relative basis, whereby we identify companies we…

    This paper describes a new investment framework to assess public companies’ “Transition Readiness”, or preparedness for a transition to a global low-carbon economy. Unlike prior low-carbon research that focuses on carbon emissions as a source of potential risk, this five-part framework is designed to capture both a company’s potential risks and opportunities associated with the transition. We construct the Transition Readiness framework on a relative basis, whereby we identify companies we believe to be better prepared for the transition relative to their industry peers. While the framework is designed to enhance investment performance as the global economy transitions to lower-carbon usage, we find that a diversified portfolio of companies that exhibit superior Transition Readiness characteristics has recently outperformed an equivalent market benchmark on a risk-adjusted basis. Finally, we find that a Transition Readiness portfolio has lower carbon emissions intensity and greater exposure to clean technology revenue relative to the market benchmark.

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  • Teacher Evaluation, Development, and Dismissal in California

    Stanford Institute for Economic Policy Research

    Students in California’s primary and secondary public schools are underachieving compared with students in other states. In the 2012 annual report published by Education Week, California public schools received a "D" for K-12 student achievement and ranked 35 out of the 50 states. Some analysts attribute low student achievement to the quality of California’s public school teachers as they are the single most important predictor of student outcomes.Numerous factors affect teacher quality in an…

    Students in California’s primary and secondary public schools are underachieving compared with students in other states. In the 2012 annual report published by Education Week, California public schools received a "D" for K-12 student achievement and ranked 35 out of the 50 states. Some analysts attribute low student achievement to the quality of California’s public school teachers as they are the single most important predictor of student outcomes.Numerous factors affect teacher quality in an education system; professional development and dismissal policies are two widely discussed factors that have recently come under heightened scrutiny.

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