Why the return on equity for shareholders will decline

The required return on equity for shareholders (the RoE) is currently very high. But we think it will have to decline in the future , because: It will be necessary to make long-term investments (for example for the energy transition), the return on which is low; it will therefore be necessary to accept a lower return on equity, both for these investments to be made, whether by the public sector or the private sector, and because making them will reduce the return on equity; The energy transition will lead to a sharp rise in energy prices; to avoid the resulting loss of purchasing power, wages will have to compensate for this rise in prices, i.e. wages will have to be re-indexed to prices, which will reduce capital income. The same applies if purchasing power is maintained by public transfer payments financed by taxation of capital income; Governments will want to reduce the negative externalities that result from corporate behaviour (climate, offshoring, redundancies, etc.). If companies internalise these externalities, the return on their equity will decline.