US businesses face a sea change on climate risk management and disclosure

By Stacy Swann The Biden administration is reportedly preparing an executive order that will require federal agencies to measure, manage, and disclose climate risks — and which, by extension, likely signals new rules for financial institutions and for companies working in sectors from energy to agriculture. Meanwhile, the Federal Reserve is setting up committees to look at climate risks to banks and the broader financial system, and the Securities and Exchange Commission is considering climate disclosure requirements for public companies. At the state level, the New York Department of Financial Services has put the nation’s first-ever regulatory framework for climate [...]

2021-04-19T17:56:51-04:00April 19th, 2021|Climate Risk, Greening Finance|

How Cities Can Access Financing for the Green Recovery

With prudent financial management, long-range strategic planning, and savvy alliance-building locally and in the corridors of government, cities can better tap into public and private funds that increasingly are targeting green and sustainable outcomes. To help cities bankroll the green and just COVID-19 recovery, a new report serves as a guide to cities to set priorities and navigate the options for attracting financial resources. This article is also posted on the C40 Knowledge Hub here.   Cities’ shopping lists for the recovery are long. Financing challenges, exacerbated by the pandemic, have compromised most cities’ ability to pay for them. While [...]

2020-12-09T13:14:17-05:00December 9th, 2020|Cities, Greening Finance|

Why Cities Need the COVID-19 Stimulus to be Green – and How It’s Not Green Enough

The fiscal response to COVID-19 is estimated globally at US$12 to US$15 trillion committed, but cities may have trouble accessing it, and only 3%-5% of announced funding is identifiably ‘green’. As the global COVID-19 pandemic approaches the one-year mark and much of the world girds for a worsening wave of the virus during the northern hemisphere’s winter, the challenges of managing the economic and social wellbeing effects are as acute as ever. Among the most affected are city governments, which are on the front lines managing a health emergency, an employment crisis, and daunting logistics and tradeoffs to safely manage [...]

2020-12-09T09:22:26-05:00December 9th, 2020|Cities, Greening Finance|

Science and data analytics can illustrate climate-related financial risks. COVID-19 might show us what climate risk will “feel” like.

News out in the last two weeks has illustrated the dramatic impacts of COVID-19 on the overall economy.  In the US, GDP contracted by 4.8 percent in the first quarter, and unemployment is at depression-era levels. The European Commission has released forecasts for a "recession of historic proportions", projecting a 7.4 percent contraction in 2020 across the European Union. Major emerging markets have suffered as well. China’s economy shrank by 6.8 percent in Q1, and Brazil’s economy is expected to shrink by at least 3.8 percent this year. Meanwhile, other major emerging market economies are bracing for the uptick in [...]

2020-09-25T14:55:47-04:00May 12th, 2020|Climate Risk, Greening Finance|

The Role of Securities Regulators and the International Organization of Securities Commissions (IOSCO) in Promoting Climate Risk Mainstreaming

In the shadow of our collective COVID19 experience, it is clearer that financial policy frameworks will need to be enhanced to reinforce our resilience to exogenous shocks, including those brought about by climate change. Financial policies and frameworks that promote transparent information necessary for financing for low-carbon, climate-resilient investment will be essential. Yet, the diversity of investors and types of investing means that there is a multitude of ways that climate considerations can be mainstreamed into financial policy and frameworks to accelerate climate-aligned investment. As such frameworks need to be tailored to the investors they cover.  Financial system governance bodies, [...]

Addressing Climate Change: The Financial Sector Reaches a Tipping Point

As the toll of climate risk events climbs, the finance sector is at a crossroads of conventional wisdom and best practices. This year, in the weeks following devastating Australian fires and unprecedented flooding in Indonesia, climate-related risks dominate the World Economic Forum’s Global Risks Report 2020 top five long-term risks. The experts who inform the annual WEF survey likewise highlight climate-related risks are among the most important short-term risks. In short, climate risks are here now. And they are gravely serious for the economy as well as the planet: A new paper from the Bank for International Settlements, the central [...]

2020-02-20T13:14:08-05:00January 23rd, 2020|Climate Risk, Greening Finance|

Signals that Financial Policymakers in the U.S. are Starting to Focus on Climate Risk

To say that climate change has the potential to threaten financial stability is not news. 2020 will mark five years since Mark Carney’s famous speech about the Tragedy of the Horizons, which highlighted the short-termism inherent in most financial decision making – both by investors and policymakers – as perhaps the single biggest barrier preventing the full integration of climate considerations into the financial system, and thus an often overlooked potential risk. Much “issue spotting” on the topic of the financial risks from a warming planet has been done since then, including the groundbreaking work of the Task Force on [...]

2020-02-20T13:15:41-05:00December 3rd, 2019|Climate Risk, Greening Finance|

Adjust, Align, Accelerate: What the Financial Sector Must Do to Deliver Resilience to Climate Change

Across the globe, physical climate impacts have become more pronounced and damaging in recent years, with grave implications for many vulnerable people and societies. The four-year period between 2015 and 2018 has been confirmed as the hottest on record and was replete with extreme weather triggered or exacerbated by climate change that negatively affected, and sometimes devastated, many countries and millions of people and their livelihoods, rippling out to entire ecosystems and economies. Both acute and chronic impacts from a changing climate are already manifesting in financial and economic losses around the globe, not only in emerging economies of the [...]

Climate Risk Disclosure is Critical – But not the Whole Ballgame

At the beginning of April, Chair of the International Accounting Standards Board (IASB) Hans Hoogervorst gave a speech expressing his views that sustainability reporting is insufficient to incite change, and that more concrete steps need to be taken to address climate change. The IASB is the premier private-sector entity establishing and governing the widely-recognized International Financial Reporting Standards (IFRS). When the IASB speaks, accountants, sustainability professionals, and ESG-attuned investors across the private sector listen – and the IASB is one of the foremost global authorities on accounting standards, which are directly upstream of corporate disclosure, lending weight to its leadership’s [...]

2019-05-13T16:08:23-04:00May 13th, 2019|Climate Risk, Greening Finance|

NGFS and Coalition of Finance Ministers for Climate Action Put Financial Markets Front and Center

April was a big month for international cooperation in the financial sector to tackle climate change. Two new supranational groups made major strides: The Central Banks and Supervisors Network for Greening the Financial System (NGFS) published its first comprehensive report on addressing climate risk through financial oversight, and the Coalition of Finance Ministers for Climate Action was formed to enable finance ministers to ramp up ambition on the Paris Agreement objectives. Framing these events, Governor of the Bank of England Mark Carney, Head of the Banque de France François Villeroy de Galhau, and NGFS Chair Frank Elderson penned an open [...]

2020-02-20T13:16:12-05:00May 7th, 2019|Greening Finance|
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