IIGCC, UNEP, CISL Analyze Financial Implications of AR5
23 June 2014: The Institutional Investors Group on Climate Change (IIGCC), UNEP Finance Initiative (UNEP FI) and the University of Cambridge Institute for Sustainability Leadership (CISL) have released a report analyzing the findings of the Fifth Assessment Report (AR5) of the Intergovernmental Panel on Climate Change (IPCC) for the financial sector.
The report, titled 'Climate Change: Implications for Investors and Financial Institutions,' considers various disruptions expected with the onset of climate change. It highlights that: sea-level rise extreme events have increased by 95% between 1970 and 2010, threatening 270 million people and US$13 trillion worth of assets; rainfall patterns have increased flooding and drought; food security is subject to rainfall variability, crop pests and volatility in agricultural markets; labor capacity and productivity have declined with higher temperatures; and policy greatly affects the amount of capital required and where funds are spent.
Noting that investors are both at risk from climate change and act as an increasing source of funding for low-carbon technologies, Stephanie Pfeifer, Chief Executive of IIGCC, stated that while climate change investments are being made, they "could be done with stronger policy." According to Andrew Voysey, Director, Finance Sector Platforms at CISL, to avoid dangerous climate change, drastic cuts in investment related to fossil fuel extraction and conventional electricity generation are required, together with significant increases in investment in low-carbon energy and energy efficiency.
Given the challenge of transitioning away from current investment patterns, the report acts a guide for financial institutions, in particular those in developing countries, as they navigate the complexity of climate change and its impacts, in order to aid them in making informed policy decisions.
The report is one of a series of 13 analyses of AR5 being produced by IIGCC, UNEP FI, CISL, and their partners - the Sustainable Fisheries Partnership, the European Climate Foundation, and the Cambridge Judge Business School. [IIGCC, UNEP FI, CISL Press Release] [Publication: Climate Change: Implications for Investors and Financial Institutions]