Investors are, by necessity, experts at taking calculated risks. They scan the horizon of our ever-evolving world for new and sometimes unexpected economic challenges so that they can put their money where it’s most likely to grow. Today, financial institutions are facing one economic challenge that will fundamentally change the way we do business—climate change.
Climate change is a risk that, while significant, is oftentimes misunderstood by the financial community. A warmer world introduces new, complex and interwoven layers of risks ranging from physical, financial, regulatory and reputational. So WRI and the UNEP Finance Initiative (UNEP FI) worked with more than 150 participants from the financial sector to create the Carbon Asset Risk Discussion Framework, a tool to help financial institutions undertake the difficult task of identifying and understanding climate-related risks to their portfolios.
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As December’s UN climate summit in Poland rapidly approaches, it is shaping up to be a race against time to prepare the so-called Paris rulebook, which will govern how the landmark climate agreement will actually be implemented.
Members of the European Parliament voted on Wednesday (10 October) in favour of increasing the EU’s Paris Agreement emissions pledge by 2020. They also urged the European Commission to make sure its long-term climate strategy models net-zero emissions for 2050 “at the latest”.
A new USAID report focuses on the intersection of climate exposure and state fragility worldwide. It finds that the factors that make a country vulberable to large-scale conflict are similar to those that make it vulnerable to climate change. The report thus offers a way for global audiences with an interest in climate and security to identify places of high concern.
A big difference. That was the conclusion the Intergovernmental Panel on Climate Change (IPCC) came to when it assessed the differences between a 1.5°C and a 2°C warmer world in a landmark special report published in early October. The leading scientific authority on climate change found that the world is likely to pass the 1.5 °C mark between 2030 and 2052 if current emission trends are not interrupted.