Skip to main content

HSBC’s Stuart Kirk – Gerald Ratner or a canary in the mine?


By Simon Neville

Stuart Kirk has been described by some as the next Gerald Ratner for his comments at an FT event, including such gems as “who cares if Miami is six metres underwater in 100 years? Amsterdam has been six metres underwater for ages and that's a really nice place.”

The bank he works for - HSBC - has distanced itself from the speech its Global Head of Responsible Investments gave at the FT’s Moral Money summit and a handful of shrill voices have said he should be sacked.

Most journalists will be laughing about Kirk’s inability to separate his previous career as a journalist from his current one as a money man, whilst comms professionals will be adding the coverage to their “how not to do it” slideshows.

Reports suggest Kirk has been suspended pending an investigation, but does this mean HSBC will also be investigating itself?

After all, Kirk’s presentation at the FT – delivered with all the grace of a hippo in a tutu - included ten slides no doubt signed off by the bank.

The speech was titled “Why investors need not worry about climate risk” where he tried to suggest the ESG conversation needed to shift from apocalyptic prophesising, towards making a better financial case for investing in the green economy.

His slides included titles like “Unsubstantiated, shrill, partisan, self-serving, apocalyptic warnings are ALWAYS wrong”, “to make climate change appear like a significant threat, scaremongers are torturing their models” and “climate change isn’t a long-run risk, just like wars, energy crises, pandemics, financial crises and so on”.

So, it is hard to see how HSBC could claim to be so blindsided by the speech or the topic under discussion based on the slides presented. 

Notably, Kirk said several times that the topics he raised have all been discussed internally at the bank.

Go have a look and judge for yourself. The FT, clearly enjoying the publicity, have uploaded the whole 15-minute speech to YouTube – the only speech it has made publicly available from the two-day event.

Some have suggested that Kirk was bang on the money, although maybe not the bit where he said: “There's always some nut job telling me about the end of the world”.

His key point is that regulators and politicians have been spending too long spreading fear to encourage spending on mitigation and not enough on financing innovation.

Clearly, his decision to silo the topic into purely how to make money in the ESG space was always going to rile some and come across as tin eared. The fallout shows that.

But the alternative view that the conversation could move us away from the culture war epitaph “you’re either with us or against us” is far more interesting.

A few asset managers and analysts have even gone public to start that debate.

Joachim Klement at Liberum, for example, writes in a note: “We think the hyperbole about a climate catastrophe is overdone. Climate change is not going to tank the stock market and the costs are manageable, though not insignificant. Where we disagree with Kirk is in his assumption that climate-related risks don’t matter for the stock market.”

Kirk may be the canary in the mine for opening the conversation up. He may wish to embrace the mantle of a victim of “cancel culture”. But Gerald Ratner he is not.

The decision next will be on whether HSBC and others wish to engage with the nuances of the debate or worry more about their image for the sake of a few bad headlines. As Kirk was trying to imply – do we want to think short-term or long-term?