Climate change financial risk
The COVID-19 pandemic has shown the deep turbulence caused by an unexpected global crisis on financial institutions and markets – and as a result on entire economies. In many ways, it has been a testing ground for the next seismic and unchartered shift that will be climate change – and it is no surprise to see climate risks now move up the priority list for financial leaders, governments, and regulators.
If the changes we faced in the wake of COVID-19 were “unprecedented,” climate change will be a whole brave new world on top of that.
Climate change will change everything – how we live, how we work, what we buy, how we structure society, how we interact in communities, how we travel, even what we eat. It will be a magnified version of what we’ve tasted during the pandemic, at an even more unpredictable pace. In addition to assess its potential impact on world economies, we need to assess its impact on individual firms.