In the News

What’s Wall Street’s role in climate? This team has an idea
E&E News, March 31, 2021

America’s biggest banks are in a jam. Under pressure from environmentalists, they’ve vowed to throw their weight behind the transition to a low-carbon economy by achieving net-zero emissions by 2050. Read more>

ECB stress test reveals economic impact of climate change
Financial Times, March 18, 2021

The European Central Bank has identified “a major source of systemic risk” in the preliminary results of its economic stress test to gauge the impact of climate change on 4m companies and 2,000 banks over 30 years. Read more>

Property Tycoons Ignore Flood Risk on Hong Kong’s Last Frontier
Bloomberg CityLab, February 8, 2021

For Hong Kong tycoons like Li Ka-shing, the New Territories is the final frontier. The verdant stretch in the west end offers one of the last relatively undeveloped patches in the cramped city, a gold mine for development in the world’s most expensive housing market. Read more>

Every Country Has Its Own Climate Risks. What’s Yours?
The New York Times, January 28, 2021

President Biden has wasted no time in moving to repudiate his predecessor’s regressive climate policies. That’s good news. The featured map shows which areas could be at high risk unless greenhouse-gas emissions are cut drastically. Read more>

How Biden’s orders hit EVs, oil and clean energy
E&E News, January 28, 2021

The Biden administration released a sweeping set of climate and energy actions yesterday that aim to block oil leasing on federal lands, create thousands of new clean energy jobs and give nearly every federal agency a role in tackling emissions. Read more>

The ESG Data Interview Series: Emilie Mazzacurati, Founder and CEO of Four Twenty Seven
Responsible Investor, December 17, 2020

When investors refer to climate change risk, they often mean the risks related to the low-carbon transition (‘transition risks’), such as changing consumer habits and technology advancements – rather than the physical risks of climate change. Read more>

Banks are getting interested in big data to figure out their climate risk
Marketplace, December 1, 2020

All this week on Marketplace Tech, we’re talking about climate change and how technology can help us become more resilient to it. It’s part of our series “How We Survive.” And a big element of the business story around climate change is risk. Read more>

How climate change could spark the next home mortgage disaster
POLITICO, November 30, 2020

With its lively parks and colorful bungalows, Hialeah, Fla., has been the gateway to the American middle class for thousands of Cuban immigrants. Hialeah was the place where home ownership, an unattainable goal under the Communist regime of their homeland, became a reality. Read more>

Every Place Has Its Own Climate Risk. What Is It Where You Live?
The New York Times, September 18, 2020

For most of us, climate change can feel like an amorphous threat — with the greatest dangers lingering ominously in the future and the solutions frustratingly out of reach. So perhaps focusing on today’s real harms could help us figure out how to start dealing with climate change. Read more>

Dit is het klimaatrisico: oranje lucht, vuile rook en miljarden dollars aan schade
NRC Handlesblad, September 18, 2020

Een week lang was Natalie Ambrosio Preudhomme niet op straat, want de verstikkende rook bleef maar hangen in haar woonplaats Berkeley in Californië. Donderdag was de meeste rook weggewaaid en kon ze „eindelijk weer een stukje wandelen”. Read more>

A Grim Outlook
The Economist, September 17, 2020

In 2012, when post-tropical storm Sandy devastated New York, the city was left in darkness. Among the few buildings still lit up was the headquarters of Goldman Sachs, which had a 25,000-sandbag wall and a backup generator. Gary Cohn, then the bank’s president, said one problem was how to get staff into the office in a shut-down city. Read more>

Ports are Highly Exposed to Climate Change and Often Ill-prepared
The Economist, September 12, 2020

In mid-January a storm gathered over Lake Michigan. Gale-force winds dragged water up and dumped it on Milwaukee. The city was “pummelled”, says Adam Tindall-Schlicht, the director of its port, which was badly damaged. Dock walls were ripped off and washed inland. Read more>

Bad Things Happen When the Jet Stream Breaks
Bloomberg Quint, August 18, 2020

The heat rolled in, the lights went out, a fire tornado materialized in the sky and the hottest temperature anywhere in the world since 1931 was recorded in Death Valley. It was a California weekend for the history books, adding to 2020’s global tally of extremes—including fires, heatwaves and tropical storms. This year has arguably offered a glimpse into the future of our climate-changed world. Read more>

Climate Change to Prolong Wildfire Seasons by Months – Four Twenty Seven
Environmental Finance, August 13, 2020

Four Twenty Seven has created a dataset projecting changes to the likelihood of wildfires in a world affected by climate change. Analysis of the data by the California-based climate risk data firm and affiliate of Moody’s, links climate drivers such as changing temperature and precipitation patterns with the availability of vegetative fuels to assess wildfire potential in the future. Read more>

COVID-19: How a Global Pandemic Could Accelerate the Energy Transition
GARP, June 26, 2020

From renewables to aviation to coal, COVID-19 has exposed both strengths and weaknesses among different sectors when it comes to climate issues. And the effects one may or may not have on each other are an emerging topic among risk managers around the world, both within large multinationals and niche firms that advise companies on carbon transition. Read more>

Florida Hurricane Season Threatens Second Hit to State Finances
Bloomberg Quint, May 7, 2020

As Florida begins to emerge from the coronavirus shutdown, another unseen threat lays in wait: hurricane season. The virus has already thrown more than a million Floridians out of work and caused a massive blow to the tourism-driven state where sales taxes provide more than half of the government’s revenue, with beaches, restaurants and amusement parks temporarily shuttered. Read more>

Blackrock, Morgan Stanley to Utilities: Tackle Climate-related Risks or Lose Market Value
Utility Dive, Apr 6, 2020

Financial market data shows utilities that address risks associated with the changing climate see significant benefits, and utilities that do not lose market value. Read more>

Climate Data Specialist Maps Course for COVID-19 Response
Financial Times, Apr 3, 2020

If you are looking for silver linings in the coronavirus outbreak, one of the most encouraging things happening is the sheer number of people using their new-found free time to find innovative ways to help (while remaining properly socially distanced, of course). Read more>

Coronavirus Is a Stress Test for Future Climate Shocks
Bloomberg, Mar 25, 2020

Risk modelers are looking at the global response to Covid-19 as a test case for how climate shocks could roil markets and push governments to respond to existential threats.

The 2° Investing Initiative, a European think tank that works with large financial firms and regulators to plan for climate risks, tried its hand at mapping out Coronavirus scenarios this week. “There are some similarities to climate risk in terms of the speed and scale with which the crisis is materializing and because this is also an exogenous risk that’s not part of the normal business cycle,” said Jakob Thomä, a managing director in Berlin. Read more>

Climate Change May Hurt Hilton Head’s Ability to Borrow Money for More Projects, Report Says
The Island Packet, Mar 9, 2020

The changing climate won’t only erode Hilton Head Island’s beaches and flood its neighborhoods. Bond rating agencies say climate change also may hurt the local government’s ability to borrow money. Read more>

Banks Taking a Closer Look at ESG Risks in Credit Underwriting
The Wall Street Journal, Jan 7, 2020

Banks are taking a closer look at environmental and social risks in deciding whether to lend money to certain corporate borrowers.

Sixty-seven percent of banks screen their loan portfolios for environmental, social and governance risks, according to a survey published Tuesday by Fitch Ratings. Read more>

The Changing Climate of Credit Risk Management
American Bankers Association, December 27, 2019

While credit portfolio managers generally recognize that physical climate risk needs to be accounted for, questions and misconceptions abound. The potential manifestations of climate change and their impacts on economic outcomes are only beginning to be understood, and it is likely that investments in resilience and risk reduction will lag understanding. Read more>

The ESG Data Files, Part Six: TCFD and the Challenge of Looking Forward
Environmental Finance, November 18, 2019

It has been two and a half years since the Financial Stability Board’s (FSB) Task Force on Climate-related Financial Disclosures (TCFD) released its recommendations designed to stimulate company disclosures about the impacts of climate change on their businesses.

The release of the report was a landmark moment in the evolution of environmental, social and governance (ESG) data because it added a new and more challenging dimension to reporting. Read more>

Illinois’s Risk to Bond Buyers Is Getting Hotter – Literally
Bloomberg, September 24, 2019

Wall Street has a number of reasons to be concerned about the credit quality of Illinois, the lowest-rated U.S. state: mounting pension obligations, billions of dollars in unpaid bills and a shrinking population. Now investors can add climate change to that list.

Western Illinois and Missouri are two areas that are expected to experience the greatest rise in extreme temperatures by 2040, according to a report on Tuesday by Moody’s Investors Service. Rising temperatures threaten to curb agricultural production and labor productivity, increase the costs for infrastructure and heighten energy demand as residents struggle to cool their homes and businesses. Read more>

Dorian’s Damage Underscores Need to Prepare for Storms and Climate Change
The Bond Buyer, September 20, 2019

Private investment in the reconstruction of the Bahamas after Hurricane Dorian could set a precedent for storm recovery in the United States.

Resilience expert Alan Rubin, a principal with Blank Rome Government Relations in New York, discussed the matter in Washington recently with U.S. Rep. Eliot Engel, D-N.Y.; Engel’s chief of staff, Bill Weitz; Eric Jacobstein, senior policy advisor for the House Committee on Foreign Affairs; and representatives from the international development agency U.S. Agency for International Development, which sent a response team to the Bahamas. Read more>

Tampa Bay Cities Prepare for Rising Sea Levels and Storm Risk 
Financial Times, September 20, 2019

The numbers add up to a bleak scenario: if the pace of global warming continues, sea levels in the Tampa Bay area could rise by as much as eight-and-a-half-feet by 2100, according to scientists’ worst-case projections.

Tampa Bay is at acute risk from climate change as its terrain is mostly at sea level, with nearly 700 miles of shoreline facing the bay or the Gulf of Mexico. A 2017 report from Climate Central, a research group, said St Petersburg and Tampa were among the 25 US cities most vulnerable to coastal flooding both then and also by 2050. Read more>

Push for Mandatory US Flood Risk Disclosure as Nearly $800bn in REITs Exposed to Sea-level Rise
Responsible Investor, September 6, 2019

US realtors may soon be required by law to disclose a property’s flood risk and history to prospective buyers, a move which could put house prices on the slide – most notably in coastal regions vulnerable to sea level rise (SLR).

So far, property valuations in these regions have been buoyant despite the increasing intensity and frequency of extreme weather events. In Miami, for example, “king tides”, caused by specific alignments of the sun and moon, have made flooding a monthly occurrence in some areas even in periods of limited storm activity. Read more>

When Levees Break: How Retailers are Preparing for a Riskier Natural World
Retail Dive, August 19, 2019

Retail executives are notorious for blaming their companies’ problems on the weather. But a cold spring that keeps people from buying new shorts and skirts at the mall is quite a different thing from an extreme weather event that disrupts a store, supply chain or entire business.

To take a severe case, consider women’s apparel retailer A’gaci. In the year before A’gaci filed for Chapter 11 the first time, the Caribbean and U.S. had been pummeled by a series of some of the most destructive hurricanes in recorded history. Read more>

L’agence de notation Moody’s renforce ses connaissances sur le risque climatique
Novethic, August 12, 2019

Moody’s vient de racheter la startup américaine Four Twenty Seven. Spécialisée dans la collecte et l’analyse des données sur le risque climatique pesant sur les entités économiques, Four Twenty Seven apporte un savoir-faire supplémentaire à Moody’s pour affiner en partie ses notations de crédit, et pour développer son expertise dans l’évaluation extra-financière. Lire l’article>

Moody’s Buys Climate Data Firm, Signaling New Scrutiny of Climate Risks
The New York Times, July 24, 2019

Moody’s Corporation has purchased a controlling stake in a firm that measures the physical risks of climate change, the latest indication that global warming can threaten the creditworthiness of governments and companies around the world. Read more>

Moody’s Catches on to Climate Risk Mispricing
Bloomberg, July 25, 2019

The acquisition of California-based Four Twenty Seven, Inc., by Moody’s Corporation could signify the beginning of a major shift in how markets price risks related to climate change. Up until now, these risks largely have been absent from investors’ models, but if Moody’s, a major rating agency, starts using Four Twenty Seven’s methods in assigning ratings, that might quickly change. Read more>

Moody’s se renforce dans l’analyse du risque climatique pour affiner ses notations
LesEchos, July 25, 2019

En 2000 ans, la terre n’a jamais eu aussi chaud. Et Moody’s veut en connaître l’impact sur l’économie. L’agence de notation a en effet acheté des parts majoritaires dans le cabinet d’analyse  Four Twenty Seven , spécialiste du risque climatique, pour renforcer sa capacité à quantifier le risque climatique. Lire l’article>

Moody’s Buys Climate-data Firm to Help Investors Price Impact of a Warming Planet
CBS News, July 26, 2019

Moody’s bought a controlling stake this week in Four Twenty Seven, a research firm that prices climate-change risk. It’s the latest indication that Wall Street is coming around to putting a price on climate change and its economic impact—albeit more slowly than many economists and investors have called for. Read more>

Hedge Funds Expect Large Jump in ESG Assets
Institutional Investor, July 24, 2019

Hedge funds expect to invest more than half of their assets next year based on environmental, social, and governance factors, a large jump from 2018, according to a survey by BarclayHedge. Read more>

Moody’s Snaps up Climate Risk Data Firm
Environmental Finance, July 24, 2019

Credit rating agency Moody’s has snapped up a majority stake in climate risk data firm Four Twenty Seven, as the wave of consolidation in the environmental, social and governance (ESG) sector gathers pace. Read more>

Moody’s Takes a Majority Stake in Climate Risk Firm Four Twenty Seven
The Bond Buyer, July 24, 2019