By Bill Kelly, CEO, CAIA Association

PPE has entered the global vernacular, courtesy of another (deadly) acronym now known as COVID-19. The latter needs no additional introduction, as the former (Personal Protective Equipment) has been one of the many combat weapons to staunch the relentless march of what is now a global pandemic. Of the many things we are learning about this outbreak, one of the most searing lessons will be how ill-prepared we were for something now so obvious, especially through the crucible of 20/20 hindsight.

From the industrial strength N95 variety, to the psychedelic bandana, the mask has become de rigueur even when practicing the art of safe social distancing. We continue to believe that it is a short-term inconvenience as we turn to our sovereign leaders demanding answers and fixes to get our global economy up and running ASAP, with perhaps little regard to the unintended ESG dividend this crisis has given us. According to a recent CNBC article, we have seen significant declines in air pollution in major cities around the world as oil consumption has dropped by over 30% or almost 4 million barrels a day. Maybe we should think about that a bit more as we long for our old mask-less ways, when next time, the accessory of choice might just be an oxygen tank.

Meanwhile, back at sovereign HQ, big oil is literally fighting for its survival as they muscle their way into the stimulus line. The usual suspects were at the White House just last week where they were praised for running such great and vital businesses by a certain commander in chief who also said that he was with them “1,000 percent.” These words of assurance came as he sat within arm’s reach of a secure phone line that has the likes of Putin and Gazprom on speed dial. That same Oval Office carpet had been worn thin by previous visits from the airline industry, along with their own cov-lite demands to make things right again.

According to a recent article in the Guardian, we might just be at an important crossroad in the ESG journey. One fork would indicate that the fossil fuel industry has met its match and that we can mark this year as the peak of demand. The less sanguine path indicates that a global economy that is salivating to find its footing will be ever more emboldened by the ‘bargain basement oil prices’ that feed the beast back to its old ways. A closer look at the fine print in the global stimulus packages might indicate that it will be the latter, and it won’t be just the demise of Mark Twain that was greatly exaggerated.

The US stimulus plans are long on tax relief and low-interest loans with no contingencies for any action related to climate or any other matters tied to ESG. Canada will provide loans to oil companies who say they are on “life support” and the EU has at least promised to align any stimulus funds with their Green Deal program—let's see how that one develops—and we will let the reader just imagine the approach China has chosen. All the while, infrastructure bills are popping up around the world with little regard to the fossil fuel outputs that are in play to cure the many tons of cement needed to execute upon those plans; and where is the Business Roundtable, which not so long ago, was the avowed champion of the stakeholder? Perhaps they too have been muzzled (or masked!) by their own self-interest.

All masks eventually will come off and intentions and implications will be laid bare. Politics and opinions will matter less as the reality of our actions will culminate in an outcome that we might still be able to control. Let’s use some of this downtime as both investors and the current stewards of our world, to figure out the facts and the science as to how to bring our economy to a better and more sustainable place once those masks are tossed aside.

Seek diversification, education and know your risk tolerance. Investing is for the long term.

Bill Kelly is CEO of CAIA Association. Follow Bill on LinkedIn and Twitter.