Four Twenty Seven's monthly newsletter highlights recent developments in climate risk and resilience. This month we discuss the overlapping challenges of COVID-19 and climate hazards, share consultations on climate risk for financial stakeholders and highlight developments in climate risk at Moody's.
The Compounding Challenges of Climate Hazards and COVID-19
Climate Preparedness Takes on New Meaning - Four Twenty Seven Analysis
Last week in the Southern U.S., residents and policy-makers weighed the risks of high winds and flooding alongside the risks of spreading COVID-19, as many evacuated to storm shelters, and 750,000 people lost power across ten states from Texas to West Virginia. Meanwhile that same week 50,000 people in Connecticut lost power because of a storm, with restoration efforts complicated by COVID-19. The devastating human health and economic impacts of the COVID-19 pandemic are exacerbated by climate hazards, which threaten communities around the world. Four Twenty Seven's new analysis explores exposure to floods, heat stress, hurricanes and wildfires in U.S. municipalities alongside the impacts of COVID-19 on the same regions.
Our analysis explores exposure to extreme rainfall in the Midwest and the particular vulnerability of essential services such as manufacturers of personal protective equipment and farmers, to disruptions due to floods. It discusses the human health implications of extreme heat and its particular threat to business continuity from power disruptions when business operations are dispersed across employees' homes. States like Louisiana and Florida are addressing COVID-19 while preparing for a busy hurricane season. Likewise, typical wildfire preparations have been delayed and canceled due to the pandemic, leaving states like California, Washington and Colorado particularly vulnerable to this year's wildfires.
Key Investments Can Build Resilience to Pandemics and Climate Change - The World Resources Institute highlights opportunities to invest in healthcare, improve disaster finance processes and develop social safety nets, to improve resilience to disasters ranging from pandemics to climate hazards.
What Links Coronavirus and Climate Change: Lack of Preparation -Bloomberg notes that we were warned of the economic threat of a pandemic and the return on investment of proactive preparation and that we still have time to heed the same warnings for climate change.
How Coronavirus Stalled Climate Change Momentum - The Financial Times covers the impact of COVID-19 on emissions and the potential longer-term impacts of stimulus packages and delayed climate policies.
Public Consultations on Climate Change in the Financial Sector
While the world is sheltering from COVID-19, regulators are moving forward with their goals to address climate change. There are currently several open consultations to gather industry feedback on new standards and reporting requirements.
EU Draft Minimum Standards for Climate Benchmarks
The European Commission is seeking feedback on draft standards for its "EU Climate Transition" and "EU Paris-aligned" benchmarks. The goals of the benchmarks are to increase transparency, help direct capital toward climate-friendly investments and prevent green-washing. Provide feedback by May 6.
FCA Proposal for Updated Climate Risk Disclosure
The UK Financial Conduct Authority is seeking feedback on its proposals to mandate climate risk disclosure for all commercial companies with premium listings. This requirement would build upon the Task Force on Climate-related Financial Disclosures recommendations and use a comply or explain approach.Respond by June 5.
Update to the EU Non-financial Reporting Directive
The European Commission is soliciting feedback on its non-financial reporting directive as part of its efforts to improve oversight of non-financial reporting in alignment with its Green Deal and a global call for a new approach to regulating non-financial disclosure.Provide feedback by June 11.
Consultation on Renewed EU Sustainable Finance Strategy
The European Commission is soliciting public feedback on its updated sustainable finance strategy, building upon its2018 Action Plan for Sustainable Finance. This strategy aims to integrate climate change and other environmental considerations into the financial system, supporting the European Green Deal. The deadline to respond was extended to July 15.
ESG and Climate at Moody's
Moody's Launches New ESG & Climate Risk Website
Moody's newESG and Climate Risk Hubcollates resources on climate risk and ESG from Moody's and its affiliates, including Four Twenty Seven. The platform includes solutions and insights to help investors, lenders and other stakeholders integrate climate risk into decision-making.
ESG Factors Frequently Cited as Material Credit Considerations
Out of almost 8,000 Moody's private sector ratings actions in 2019, about a third referenced material ESG considerations. Moody's Investor Service's new reportshares findings on how ESG considerations are factored into ratings actions.
Climate Risk News
New High Temperature Records Set
Last month was thehottest month on record for the world's oceansand the oceans' five hottest years have been within the last ten years. Warm oceans are connected to many climate hazards, ranging from hurricanes to wildfires. If the Atlantic remains warm during hurricane season, it's expected to contribute to stronger storms this year. Meanwhile, warm seas can pull rain from inland, contributing to drought associated with wildfire conditions. This occurred last year in Australia when the Indian Ocean was particularly warm off of Africa's coast.
These ongoing scientific findings on the dire rate of climate change, including new temperature records and updatedsea level rise projections, have significant financial implications. The Global Association of Risk Professionals (GARP) launched a newGlobal
Sustainability and Climate Risk Resource Center to help communicate these risks. This platform introduces climate change for financial stakeholders and provides resources to help risk managers understand climate risks.
Inside the Office at Four Twenty Seven
Senior Climate Data Analyst - John Naviaux
Four Twenty Sevenwelcomes John as Senior Climate Data Analyst. John performs stochastic modeling of climate and weather data to advance Four Twenty Seven’s climate risk analytics. Previously, John worked on topics ranging from transportation economics in Los Angeles to particle physics at the Large Hadron Collider in Geneva, Switzerland. John monitored arctic mercury pollution in Norway as part of a Fulbright Fellowship, and received his Ph.D. at Caltech for his research on the ocean’s response to climate change.
Four Twenty Seven is Here to Serve our Clients
As COVID-19 has led to widespread disruption in businesses and personal lives, Four Twenty Seven remains committed to ensuring the safety of our staff and clients while also continuing to provide the same data, analysis and client support that we are known for. Our business remains open globally, with teams in the U.S., Paris, London and Tokyo working remotely. Please do not hesitate to reach out to us via email or on our cell phones.
Upcoming Events
An Update on Postponements and Cancellations:
Apr 28 – Afire Rising Leaders Summit, New York, NY: Chief Revenue Officer, Lisa Stanton, will speak - CANCELED
Our mailing address is:
Four Twenty Seven
2000 Hearst Ave
Ste 304
Berkeley, CA 94709
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