even if the international community succeeds in reaching the goals set out in the 2015 Paris Agreement to limit global temperature increases, the output on farms and construction sites would be challenged, while migration would increase and heat and other climate factors would cause more deaths across the globe. This is in addition to widespread property damage anticipated as a result of coastal flooding and other extreme weather conditions, which could total trillions of dollars by the end of this century.
Back in 2015, Mark Carney, who was then governor of the Bank of England at the time and the former governor of the Bank of Canada, issued warnings regarding the threats posed by the climate crisis, with specific reference to “re-pricing” events. This includes the imposition of new liabilities on companies, physical damage that destroys the value of assets and sharply raises insurance prices.
Six years later, the BOE and other related organisations, including 100 central banks, formed a group to exchange research and potential policy solutions. This was aimed at making noteworthy progress toward climate goals part of the fiduciary duty of lenders, asset managers and investment banks. At the UN climate summit which recently concluded in Glasgow, Carney announced that banks and asset managers representing 40 per cent of the world’s financial assets have vowed to decarbonise their operations by mid-century and to set more immediate goals for 2030.
