Climate change is a financial risk for investors and in a recent article I posed the question ‘What are the best infrastructure investments to make? Should they be based on economics, resilience or both?’ I delved into how we can select infrastructure investments that are optimum and what we need to consider when determining the best investments to make.
A new guide released by the Investor Group on Climate Change (IGCC) takes these questions further, to look specifically at emerging climate risk tools which can help investors manage physical climate risk – at portfolio and asset levels.
The guide - Investing in Resilience: Tools and Frameworks for Managing Physical Risk – lays out some of the key concepts, issues and challenges associated with adaptation and provides a snapshot of emerging resources to help manage for resilience.
This guide was initially developed through a workshop, in which I participated, where we mapped the landscape of emerging tools and resources for managing climate resilience.
Held on 6 June 2018, the invitation only workshop aimed to identify tools and frameworks available for managing climate resilience in investment and lending decisions.
It was an interesting, and insightful mix of participants – from institutional investors and financiers, to corporate, legal, insurance and ESG stakeholders involved in addressing the resilience challenge.
Through looking at recent market innovations in tools, identifying physical risks, evaluating options and measuring impact, we successfully identified practical tools for managing resilience, which formed the backbone of this new guide.
See videos of key stakeholders from the Investing in Resilience workshop, discussing science, legal, finance, community and infrastructure perspectives on the importance of climate resilience.