Global warming plus leverage equals a big mess for companies.
A recently settled class action lawsuit against the Australian government could help drive greater disclosure of climate financial risk by governments, central banks and companies.
OSFI’s guidelines are a small step towards making financial decision-makers more conscious of their influence on climate outcomes, but there is still work to be done.
Regulators, banks and policy-makers use stress tests to uncover weak points in how financial institutions operate and identify changes that will help buffer them from harm.
A holistic view of climate change risk considers climate hazards, exposure, vulnerability and the responses to these. It also takes into account how multiple risks interact.
Businesses have long been a big part of the climate problem. They shouldn’t scale back environmental initiatives when it all feels too hard.
There’s a growing push among businesses, including the finance sector, to protect the climate and nature.
The groundbreaking legal case has changed the game for how Australia’s $3 trillion superannuation industry invests, and how members are protected from climate risk.
I have criticised this government’s climate policy in the past for being big on promise but short on concrete policies. But this financial disclosure policy has some real teeth.