The rising impacts of climate change: Implications for science, law, capital markets, and policy

The physical effects of climate change present risks across society. Increasingly, these varied perils, from hurricanes to heat-stress, wildfires and many others, are being understood through the lens of financial risk management. For example, a report from the Commodity Futures Trading Commissions identified climate change as “a major risk to the stability of the U.S. financial system and to its ability to sustain the American economy.” Many financial regulators outside the U.S. have similar perspectives, and there is rapidly growing pressure on financial actors to respond. The analytical tools needed to understand these financial risks from the physical impacts of climate change are improving rapidly and a new face of financial market regulation and response is coming into focus.

On March 31, the Markets at Risk initiative at Brookings, in collaboration with the Environmental Defense Fund and the Columbia Law School’s Sabin Center for Climate Change Law, hosted an event exploring these issues. Experts in climate science, finance, and the electricity sector considered the question at the heart of their research: What can the scientific, legal, energy, and financial sectors do to help the nation prepare for the growing impacts of climate change?  Questions from the audience followed the discussion.

Questions from the audience followed the discussion. Viewers can submit questions by emailing [email protected] or on Twitter using #ClimateRisk.

A copy of the Markets at Risk paper on climate risk disclosures can be found here.