If you work for a financial institution, you can play a crucial part in protecting the world from the impacts of climate change. You can also future-proof your business by protecting it from climate risk – for instance, scrutinizing physical hazards like flooding that threaten your mortgage portfolio or real estate investment trust (REIT) in your lending or investment portfolio. This isn’t just a risk management approach – it’s something that investors are increasingly demanding, and it may soon become a regulatory requirement. If they’re approved, the rules proposed by the Securities and Exchange Commission (SEC) will require all publicly listed companies in the US to disclose information on climate risks that could have a material impact on their business. The proposal would also require organizations to disclose their greenhouse gas emissions – driving increased scrutiny of companies’ supply chains and progress towards meeting their climate targets.
In addition to managing risk, you’ll want to seize opportunities presented by the energy transition. For instance, the Inflation Reduction Act creates significant financial incentives for investing in the shift to a low-carbon economy. To get ahead of these risks and opportunities, you’ll need to integrate climate risk and net zero concepts into the fabric of your organization. This includes providing tailored training for your teams and working to embed climate considerations into your business-as-usual operations.
To find out which areas you should focus on as you work to embed climate risk and net zero within your organization, watch this video:
If you’d like to learn more about how we help our clients successfully navigate climate risk management and net zero strategy, please contact us.
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