With the UN Climate Change Conference (COP21) having taken place in Paris, governments and business leaders will reflect on the next steps to limit global warming. All stakeholders now realise the urgent need to combat the negative impacts of rising global temperatures to the global economy.
As such, Standard & Poor’s has released an in-depth report, Insights: Climate Risk, detailing the considerable financial repercussions of the transition to a sustainable, resilient world economy. Drawing on a range of analysts, the report highlights the need to prioritise the financial incentives that will drive progress – promoting divestment from fossil-fuel assets through carbon markets, for instance, along with investment in energy-efficient infrastructure, and renewable sources such as wind or solar power. The report also notes the value of environmental, social, and governance (ESG) analysis to responsible investing, and the need to factor environmental and climate-related risk into financial planning and creditworthiness.