Climate change
Prudential CRO: markets haven’t priced in tail risks
Risk USA: distribution of extreme outcomes “has gotten broader and wider”, says Nick Silitch
Climate scenarios: carbon price shock sees asset prices slump
Crowdsourced scenario analysis suggests very few sectors safe from a post-COP carbon price pop
Banks seek regulatory guidance on climate transition plans
Lack of agreement on how to identify whether borrowers are converging with net zero targets
BlackRock’s own reporting undermines its climate claims
Axa, Allianz and Legal & General have all cut their investments’ emissions, unlike BlackRock
Measuring climate risk: what’s possible now
Governmental and societal pressure on banks and asset managers to help manage climate risk and disclose progress toward a sustainable future is high. Institutions are working to quantify the impact of climate change on their balance sheets and want to…
TCFD backs carbon disclosure, but not temperature scores
Influential standard setter decides the implied temperature rise ‘is not ready’ for funds
Applying scenario analysis to climate risk
Matthew Lightwood, director, risk solutions at Conning, discusses the application of stochastic modelling with scenario analysis to quantify climate risk in a portfolio
Climate risk: the writing is on the wall
For the EU financial sector, climate risk is inescapable, but it could be tamed
Weather, or not: is climate risk just part of credit risk?
Practitioners divided on whether climate risk can fit into existing credit risk weights
Default risk set to rise from climate inaction – ECB
‘Hothouse world’ scenario could see average probability of default increase significantly more than under both orderly or belated transition
Study fuels doubt over benefits of climate risk-weights
Research finds both green supporting factor and carbon penalising factor have drawbacks
BlackRock to grant funds power to track climate risks
Aladdin system holding trillions of dollars to show whether funds are burning the Earth or saving it
Amundi, Axa urge boardroom pay cuts for climate laggards
Link remuneration to carbon-emission goals and companies will get serious, say large investors
FSB debates how to fit climate risk into capital rules
Regulators ponder whether climate risk needs new RWAs or recalibration of existing ones
Why new EU rules are fuelling greenwashing and how to stop it
Reporting requirements for ESG funds may not solve the problem – a list of harmful investments might
APG hires in-house weatherman to interpret climate data
Europe’s wettest summer in a century prompts asset managers to calculate flood risk for real estate
Overhyped green status is no longer a risk-free sales tool
Asset managers’ ESG claims will now be more closely scrutinised following DWS allegations
Green bonds risk failing TLAC test
Europe’s banks – in their scramble to issue ethical debt – butt up against tough rules on loss-absorbing capital
Climate risk-weights a ‘terrible idea’ for aiding transition
Carbon pricing and direct regulation of top emitters seen as better approach
The sticky question of Europe’s oil-ridden ESG funds
NN Investment Partners SFDR fund holds 91% of investments in oil and gas companies
40% of insurers fail to specify climate as a key risk – LCP
Despite regulators’ urging, many UK and Irish insurers omit climate from risk statements, says report
Derivatives pricing starts feeling the heat of climate change
Quants find physical and transition risks can lead to significant rise in CVA
Capturing the effects of climate change on CVA and FVA
A framework to incorporate climate change risk into derivative prices is presented
Isda disputes excessive FRTB charges for carbon trading
EU carbon certificates show lower volatility and higher netting than Basel approach assumes