Profile VIII: Ms. Alicia Seiger, Managing Director of The Sustainable Finance Initiative, Stanford University
In this issue, The Daily Dynamo met with Ms. Alicia Seiger, lecturer at Stanford University’s School of Law, Graduate Business School, and the Doerr School of Sustainability, and Managing Director of the Doerr School’s Sustainable Finance Institute, one of the nation’s premier institutes in the arena. Throughout her career, she’s worked extensively in both the public and private sectors of energy. In government, she’s advised the governors of California and New York on climate resilience; in the corporate world, she’s advised numerous startups, many of which have heralded novel technologies in the energy space. All of her work thus far has been a culmination of her focus on a topic paramount in today’s world – sustainability.
Seiger traces her initial journey with sustainability back to her time in North Carolina when she “read Al Gore’s Earth in the Balance for a freshman seminar at Duke and was immediately transfixed by the challenge of harmonizing human and natural systems.” While she saw “climate change [as] a distant threat”, she realized “that if [the world] made smart choices in the ‘90s and early decades of the 2000s, we could avert a lot of suffering”. From a learning standpoint, she sees the threat of climate change as a compelling opportunity for students: “it is a fascinating problem that demands understanding and innovation across many disciplines – science, technology, economics, finance, policy, psychology, sociology and the arts – and across human and natural systems”, Seiger asserted.
As an experienced professional with public and private sector knowledge, she highlighted the divide between the two spaces, lamenting the lower pay relative to private sector counterparts. She added that the external influences that come with government policy make the business of policymaking even more of an uphill climb at times. “It is [very difficult] to navigate the politics of good decision-making”, she stressed. With a plurality of private sector lobbying and influence, policymakers often find it “not easy to do the right thing when you’re subject to protests and pressures from vocal and powerful stakeholders”, she contended. However, she asserted that the public sector can be an invaluable environment for policy experimentation. “With respect to substance, I learned that states can be great test beds for innovation across finance, policy and infrastructure – including data, institutional and physical infrastructure.”, Seiger maintained, echoing the age-old paradigm of states as ‘laboratories of democracy’.
When Ms. Seiger joined Stanford over a decade ago, “the financing ecosystem for early-stage climate innovations was barren”, she lamented. She added that during her time in Palo Alto, the Steyer-Taylor Center for Energy Policy & Finance “built a robust and thriving ecosystem” that facilitated unprecedented investment in adaptation & resilience initiatives, heralding a new age of energy finance at Stanford.
As an expert in risk management, dealing with climate risk during her time in state executives, she highlighted more of the same, adding that the Center has advanced the divestment from conventional fuels to a “more robust and actionable set of questions having to do with climate risk and opportunity for
investment portfolios”. To her, this pathway, irrespective of private or public affiliation, stems from climate accountability, which she and her team wrote extensively about in her Settling Climate Accounts: Navigating the Road to Net Zero, a book which details how net-zero strategies became the ‘dominant organizing principle’ of the sustainability movement.
From her standpoint, the issue of climate has become incredibly centered around the concept of ‘net zero’, which she asserts is driven by a strategy of carbon offsets which result in carbon neutral entities. Unlike others profiled by the Daily Dynamo, Seiger approaches the issue from a finance standpoint, identifying four main obstacles that fall in the way of effective climate finance:
“current practice leaves capital allocators exposed to (1) noisy and unactionable data, (2) confusing and shifting boundaries of disclosure and control, (3) a mismatch of time horizons – noting that climate is a stock problem and net zero is a flow concept; and (4) moral and scientific imperatives not yet supported by policy and financial incentives.”
Seiger asserts that ‘upgrading the climate toolkit’ will go a long way towards achieving society’s climate goals. To her, this starts with changing from a private sector strategy of disclosure – a communication of carbon emissions without a clear framework of future action – to a strategy of accounting. Such a move moves away from a compliance mechanism and towards a capital allocation mechanism, which will create a foundation for substantive climate finance. Seiger also asserts that a strategy of carbon solvency, in lieu of a net-zero centered approach, can herald an age of improved efficiency.
“Net zero is a promise to zero out emissions at a future date and in the meantime some arbitrary amount of capital is allocated to avoiding emissions; carbon solvency is an auditable accounting of emission liabilities defeased by E-assets”, she explained. By “evolving from disclosure to accounting and from net zero to carbon solvency”, she believes that the private sector will be far more equipped to complete a green transition, one she added will be decades long, not an immediate overhaul of current resources.
Looking forward, she sees an economy that treats climate as a foundational principle necessary for existence:
“Every career is going to be a climate career in that climate change is going to impact every sector of our economy and nearly every job function. Having informed, empowered, and passionate leaders across sectors and functions who understand how climate intersects systems and how systems can improve climate outcomes is going to be key to navigating what lies ahead”, Seiger mused.
Like any effective changemaker, she also stressed the incredible importance of communication, especially in tackling climate change: “Being able to listen to, empathize with, and translate across a wide range of voices is important in solving [the greatest] climate and sustainability challenges [of the day]”. As a mother of two teenage daughters, she believes there’s nothing better that she can do with her time, and she implores the next generation to hold themselves to that same paradigm.
