Resource Database

Research addressing compound and connected events, and their integrated risk to the natural and built world, is gaining momentum. Paradigms are now evolving to classify and analyse the processes forming such links — whether physical or societal, direct or indirect — and the role of climate change in their ultimate impacts.

In risk analysis, it is recognized that hazards can often combine to worsen their joint impact, but impact data for a rail network show that hazards can also tend to be mutually exclusive at seasonal timescales. Ignoring this overestimates worst-case risk, so we therefore champion a broader view of risk from compound hazards.

This guide gives investors a framework to help them understand and engage on deforestation-driven climate risks across their portfolios. It is especially intended for investors who are relatively new to deforestation and may be engaging on climate risk but not deforestation risk. The guide will help them understand the drivers of deforestation risk and prioritize company engagements based on industries, geographies and sourcing patterns. It also outlines key expectations that investors should be looking for in corporate climate and deforestation commitments and example questions for company and sector engagements. Lastly, the guide provides concrete next steps investors can take to address deforestation risk.

This report reflects interviews with corporate professionals about the roles and activities of finance in their organizations’ sustainable business and integrated enterprise activities. An overarching consensus is the need for proven, supported methodologies that demonstrate enhanced performance and added value. This is a key mission for the current cohort of CFOs and professionals who aspire to senior business leadership roles. In order to break silos on the way to the C-suite, these corporate professionals need a value-creation mind-set and a working command of the concepts of risk management, governance, innovation, talent management, technology, environmental management, and social responsibility.

Climate change is happening, and its effects are already visible across the world. Human activities and businesses are being impacted in all sectors by extreme weather and climate events and chronic shifts in climate such as increasing temperature, changes in rainfall patterns and sea-level rise. These physical impacts of climate change are expected to worsen over the next few decades, threatening financial investments and activities. If the regulatory framework has evolved, with the set of recommendations issued by the Task Force on Climate-Related Financial Disclosures (TCFD) for a better climate risks reporting in the financial sector, the investors lack the tools and expertise to quantify the impacts of physical climate risks on their assets and investments. Moreover, the physical impacts of climate change are highly localized, and tailored, detailed information is needed, from climate variables to financial indicators.
This report introduces the impact chain framework that can help decision makers understand risk assessment implementation issues, and build capacity for analyzing and managing risks. This framework is further detailed and illustrated through several case studies on assets and portfolios. This report presents both the methods and the tailored information generated for the finance sector, from the assessment of vulnerabilities to the creation of financial indicators. We describe commonalities and differences across sectors, type of portfolios and data availability context. We highlight the challenges and the opportunities of the project’s inter-disciplinary approach.

How should organizations cope with climate change? As president and executive director of the Woods Hole Research Center, Dr. Philip Duffy has spent much of his career translating climate science for business leaders and policy makers and fostering awareness of how climate change affects society. His colleague, former investment manager Spencer Glendon, joined Woods Hole to explore the pressure that climate change places on the financial system. In these edited excerpts from two interviews, Duffy and Glendon discuss the unforeseen challenges our increasingly unstable climate creates for businesses and governments. “Folks don’t grasp the immediacy, the scope, and the scale of physical climate risk,” says Duffy.

For decades, Environmental, Social, and Governance (ESG) scoring of investments, and public reporting of those scores, has focused mainly on one side of a two-sided coin, namely, what a business or asset is doing to the planet — particularly, the “Carbon Footprint” of that company measured by CO2 greenhouse gas emissions. The other side of that coin is, of course, what the planet is doing to the same business or asset, or its physical climate risk or “Risk Footprint.”

The changing climate is poised to create a wide array of economic, business, and social risks over the next three decades. Leaders should start integrating climate risk into their decision making now.

A growing number of building owners are benchmarking and disclosing resilience performance, due in part to increased investor and market pressure. However, the plethora or reporting frameworks and approaches can create confusion and uncertainty on how to proceed. This fact sheet provides an overview of common trends and barriers related to disclosure of climate and resilience performance. It reviews how each of the major reporting frameworks treats resilience, compares these frameworks against each other, and provides insight on where to begin.

This commentary provides a high level overview of the recent economic environment, and is for information purposes only. It is a marketing communication and does not constitute investment advice or a recommendation to any reader of this content to buy or sell investments nor should it be regarded as investment research. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of its dissemination.

This paper provides a tool to build climate change scenarios to forecast Gross Domestic Product (GDP), modelling both GDP damage due to climate change and the GDP impact of mitigating measures. It adopts a supply-side, long-term view, with 2060 and 2100 horizons. It is a global projection tool (30 countries / regions), with assumptions and results both at the world and the country / regional level. Five different types of energy inputs are taken into account according to their CO2 emission factors.