Could the next housing crisis be climate-related? Quite possibly. This summer my partner and I tried to buy a house in the Catskills, New York. It was the end of June when we ran the inspection and no drought was in effect. The report came back that the well was almost dry – something the owners (who didn’t live there full time) claimed was a shock to them. And it could have been. Several other homes in that small town had their wells run dry for the first time this summer. Read more>
For what seems like an eternity, “location, location, location” has been a mantra for REIT executives and other commercial real estate professionals. Now, three more words are entering their lexicon with greater frequency—environmental, social and governance. Read more>
Residents of U.S. towns damaged by wildfires may need to prepare for another repercussion: insurers that decide to cancel policies because of increased risks from more frequent fires.
Facing mounting losses, some property insurers are pulling back from selling policies in California and other western states where wildfire risk is elevated. In California alone, damages had mounted to at least $12 billion by early 2018, while the state’s Carr fire likely added another $1.5 billion in insured losses. Read more>
Just when it seemed like things couldn’t get any worse in California, the Carr wildfire ignited, claiming six lives so far. The fire in Northern California near the city of Redding has been burning since July 23 and is now one of the largest in the state.
Almost 90,000 acres have burned, destroying more than 500 homes and commercial buildings and damaging 135 structures. Firefighters, who are working 24- to 36-hour shifts with little rest in between, said they are making progress and are now on the offense rather than in a defensive mode. Read more>
Investors are pressing for more specific information on how climate issues affect corporate operations, a concern that’s heightened since the SEC has stopped prodding companies on climate-related disclosures.
The Securities and Exchange Commission last issued a climate change-related public comment letter in September 2016, when it asked Chevron Corp. to expand its risk factor disclosure related to California’s greenhouse gas emission regulations. Read more>
Hurricane season in the Atlantic Ocean typically lasts from June to November, with the brunt usually hitting in the months of August and September. In recorded history, there have been a total of 33 Category 5 hurricanes, which are storms that have sustained wind speeds of over 157 miles per hour, or 136 knots. Between 1924 and 2002, there were 22 Category 5 hurricanes recorded in the Atlantic. From 2003 through 2017 there were 11, with three coming in the last two years. In addition, since 2001, there have been 24 Category 4 hurricanes (storms with wind speeds of 130 to 156 mph)—compared to a total of 47 over the previous 50 years. Whatever your political beliefs are relating to climate change, it’s a proven fact that catastrophic storms have become bigger, more frequent, and more costly in the 21st century. Read more>
Many of us in the northern hemisphere have worked through the warmest May on record. No wonder physical climate risk is a hot topic for investors. Poor them. Having been made to wrap their heads around the concept of transition risk — the effect of decarbonisation on portfolio returns — they now have to think about exposure to rising sea levels, extreme heat and cyclones. Read more>
Investors are being encouraged to engage with companies on physical climate risks, both reactively and proactively, by identifying those with the biggest exposure to extreme weather events. Read more>
While companies may drag their feet on disclosing the true extent of their risks relating to climate change, investors can overcome such subterfuge by raising awareness of the risks and engaging directly with targeted companies. So says Four Twenty Seven, a provider of climate risk intelligence for financial markets.
Shareholder engagement on climate change already has grown tremendously in recent years, notes a new report from the firm. More than 270 institutional investors, collectively managing almost $30 trillion of assets, have joined in an effort called Climate Action 100+. Read more>
Four Twenty Seven, a Berkeley, California, company that developed software to track climate change risks for private companies, wants to help bond investors evaluate the risks to cities and counties.
Focusing on climate change-based economic risk analysis, the company created a software application using data to model the risks for cities and counties after it received a request from Breckinridge Capital Advisors, a fixed-income fund manager. Read more>
LONDON (Reuters) – The European Bank for Reconstruction and Development has published guidance for companies reporting on the physical impact of climate change in their financial results.
Concerns in the financial community that assets are being mispriced because climate risk is not being factored into financial reporting has prompted demand for more meaningful and transparent climate-related financial information. Read more>
Climate change is a beast, melting glaciers, destroying vegetation, raising temperatures, and decreasing property values.
A new report from advisory firm Four Twenty Seven identifies US municipalities most exposed to climate hazards like hurricanes, sea level rise, extreme rainfall, heat stress, and water stress. Read more>
Deutsche Asset Management is set to consider companies’ exposure to catastrophic climate events as part of its investment decision-making.
Deutsche developed the new approach with the help of California-based climate intelligence advisory firm Four Twenty Seven. The latter has mapped the physical locations of more than 1m corporate facilities globally and uses scientific models to assess the likelihood of them being affected by climate hazards such as heatwaves, floods and cyclones. Read more>