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.
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.
Climate change is an "emerging threat" to U.S. financial stability that regulators should address in their everyday work, a top U.S. regulatory panel said
A key feature of climate change is that it doesn’t pose one single risk. Rather, it presents multiple, interacting risks that can compound and cascade. Importantly, responses to climate change can also affect risk.
In our highly connected world, climate risks and our responses to them can be transmitted from one system or sector to another, creating new risks and making existing ones more or less severe. In many cases risks cannot be understood without considering these interactions.
Recent evidence indicates how some of the most severe climate change impacts, such as those from deadly heat or sudden ecosystem collapse, are strongly influenced by interactions across sectors and regions.