Much of the global economy depends on natural capital—the world’s stock of natural assets. Acting as the planet’s balance sheet, natural capital provides critical services and resilience. It supports water cycles and soil formation while protecting our communities from major storms, floods, fires, and desertification. By absorbing CO2, it limits the pace of climate change. Biodiversity, a core component of natural capital, supports activities as wide-ranging as pharmaceutical innovation, ecotourism, and crop pollination. These are just a few of the numerous “co-benefits” that make nature so valuable. Yet the complexity of natural capital makes its benefits hard to quantify, leading many to overlook nature as an investment opportunity. In this report, we describe and apply a methodology that can help quantify some of the costs and benefits of conserving natural capital.
Today, international banks BBVA, BNP Paribas, ING, Société Générale and Standard Chartered (also known as ‘the Katowice Banks’) published a report on the application of the PACTA methodology, designed to steer their credit portfolios towards the objective of the Paris Climate Agreement. This report aims at helping banking peers to quickly understand and apply this methodology and thus publish comparable results.
Lenders should be subjected to tough reviews of their readiness for economic threats posed by severe weather, required to disclose risks lurking in their portfolios and perhaps forced to set aside extra capital, a government study recently recommended.
The richest one percent of the world’s population are responsible for more than twice as much carbon pollution as the 3.1 billion people who made up the poorest half of humanity during a critical 25-year period of unprecedented emissions growth.
Smoke from the West Coast traveled across the US this week and is now well on its way to Europe. From our HQ in NYC – the sky was hazy and the sun resembled the Eye of Sauron.
Climate change risk has plagued US insurers over the last several years and the severity is growing. A task force led by several US financial regulators issued a 200-page report warning that climate change poses “serious emerging risks to the U.S. financial system.” Many central banks in other countries are conducting climate “stress tests,” and, in Europe, many companies are now reporting their climate risks.
Riskthinking.AI helps clients better understand their climate-related financial risk so they know where their portfolios are exposed and can hedge or take other appropriate actions.
The Hawai‘i State Senate announced that a bill protecting Hawai‘i’s coastal ecosystems was signed into law by Gov. David Ige. The enacted legislation includes a provision to ban further construction of sea walls and coastal hardening projects.
Backers of the bill say “the convergence of dense development along shorelines, increasing landward migration of shoreline due to sea level rise and other human and natural impacts, and extensive beach loss fronting shoreline armoring necessitated the revision of existing policies and regulations.”
An international effort that brought together more than 60 ice, ocean and atmosphere scientists from three dozen international institutions has generated new estimates of how much of an impact Earth’s melting ice sheets could have on global sea levels by 2100. If greenhouse gas emissions continue apace, Greenland and Antarctica’s ice sheets could together contribute more than 15 inches (38 centimeters) of global sea level rise – and that’s beyond the amount that has already been set in motion by Earth’s warming climate.
Food production accounts for one-quarter of the world’s greenhouse gas emissions and takes up half of the planet’s habitable surface. Adjusting one’s diet to eat less (or no) meat and dairy would deliver tremendous emissions savings and have positive health outcomes as well.
The 21st century is shaping up as a world of global risks. We’ve seen the effects of global terrorism, systemic financial failure and pandemic, and we’ve adjusted (or are in the process of adjusting) to the policy responses deployed to contain these risks. Riskthinking.AI methodology is at the cutting edge of translating climate risks into financial risks; a crucial step in spurring companies to respond more effectively to the climate crisis.
…the Electoral College also undermines the fight against climate change. If every additional vote in California, Oregon, and Washington—which between them boast roughly 50 million people—mattered as much as every additional vote in a swing state, Biden might have spent the past few weeks touring the West Coast and explaining how his plans can save its residents from a climate apocalypse that threatens to make their home unliveable. But the Electoral College rules that out. Biden has no incentive to run up his margin in three reliably blue states. Instead, he’s singularly focused on purple ones in the Midwest. So far this month, he’s visited Michigan, Wisconsin, and Pennsylvania, and he’s headed to Minnesota next week. Conventional wisdom holds that in a Midwest built on fossil fuels and heavy industry, focusing on climate change is politically risky.