Empowering clients to explore the impact of pension schemes on the planet for a sustainable future
GLOBAL RESEARCH
What research is out there to help us understand risks to the planet?
SCHEME RISKS
What is the impact of these climate and biodiversity risks on my funding plans?
MAKING A DIFFERENCE
What is the impact of my funding plan on the planet and how can we improve this?
What else can we do to help save a world worth retiring in…?
GLOBAL RESEARCH
What research is out there to help us understand risks to the planet?
The 2024 Europe Report of the Lancet Countdown on Health and Climate Change
Source:
https://www.thelancet.com/action/showPdf?pii=S2468-2667%2824%2900055-0
This study provides a comprehensive assessment of the impacts of climate change on health and the environment across Europe. It tracks 42 key indicators related to extreme weather events, infectious diseases, food security, and public health vulnerabilities, offering insights into the growing risks posed by climate change and the need for urgent adaptation and mitigation strategies.
Quantifying the impact of climate change on human health
Source: https://www3.weforum.org/docs/WEF_Quantifying_the_Impact_of_Climate_Change_on_Human_Health_2024.pdf
The effects of climate change on human health and the global economy are profound. An analysis of six major climate-related events—including floods, droughts, and heatwaves—projects that by 2050, climate change could result in 14.5 million additional deaths and $12.5 trillion in economic losses. The report underscores the increasing strain on healthcare systems, emphasizing the urgent need for mitigation and adaptation strategies to address these escalating challenges.
WMO Atlas of Mortality and Economic Losses from Weather Climate, and Water Extremes (1970-2019)
Source:
https://library.wmo.int/viewer/57564/download?file=1267_Atlas_of_Mortality_en.pdf&type=pdf&navigator=1
An extensive analysis covering the period from 1970 to 2019 reveals that weather, climate, and water-related hazards have caused over 2 million deaths and $3.64 trillion in economic losses. By examining global and regional disaster trends, the study highlights the escalating impact of these hazards and underscores the crucial role of early warning systems in reducing mortality rates, even as the frequency of such disasters continues to rise.
Projections of Temperature-Attributable Mortality in Europe
Source:
https://www.thelancet.com/action/showPdf?pii=S2542-5196%2821%2900150-9
Exploring the link between climate change and human mortality, this research demonstrates key statistical methods for analysing the effects of temperature variations on mortality rates. By modelling regional data and projecting future trends, it provides a comprehensive framework for understanding how different climate scenarios could impact public health, offering guidance for future studies in this field.
Climate paths/scenarios
Various climate scenarios, including those from the Bank of England’s Climate Biennial Exploratory Scenario (CBES), the Intergovernmental Panel on Climate Change (IPCC), the International Energy Agency (IEA), and the Task Force on Climate-related Financial Disclosures (TCFD), provide comprehensive insights into how different levels of climate action or inaction will shape our future. These scenarios assess risks such as extreme weather events, regulatory changes, carbon pricing, and economic disruptions. By evaluating both physical and transition risks, they help businesses, financial institutions, and policymakers plan for resilience and align with global climate targets.
Source:
https://www.bankofengland.co.uk/stress-testing/2022/results-of-the-2021-climate-biennial-exploratory-scenario
CBES - Climate Biennial Exploratory Scenario
The CBES, developed by the Bank of England, assesses how banks and insurers manage climate-related physical and transition risks. It explores different scenarios like Early Action, Late Action, No Additional Action, and Short-term Disorder, to evaluate their financial impacts. Financial institutions must use these scenarios to stress-test their balance sheets and prepare for risks such as extreme weather, carbon pricing, and market shifts. Regulatory requirements ensure firms conduct these stress tests, maintaining adequate capital to absorb potential losses and meet supervisory expectations for financial resilience.
Source:
https://www.ipcc.ch/report/emissions-scenarios/
IPCC scenarios
The IPCC scenarios, developed by the Intergovernmental Panel on Climate Change, include scenarios like RCP2.6, RCP4.5, RCP6.0, and RCP8.5, which model different climate futures based on varying emissions levels. These scenarios are widely used by firms to assess long-term physical risks from climate change, especially in sectors vulnerable to environmental impacts, such as insurance and real estate.
IEA scenarios
Source:
https://www.iea.org/reports/world-energy-outlook-2023/context-and-scenario-design
The IEA scenarios, created by the International Energy Agency, help energy-intensive industries and policymakers understand the future energy landscape and transition risks. These scenarios are key for firms in the energy sector to plan for decarbonization and align with climate targets like Net Zero by 2050.
Source:
https://www.tcfdhub.org/scenario-analysis
TCFD scenarios
The TCFD scenarios, promoted by the Task Force on Climate-related Financial Disclosures, encourage companies to use climate pathways like the 2°C and 1.5°C scenarios for financial and risk disclosures. These scenarios are widely adopted for ESG reporting and climate risk management across various industries, especially by firms facing investor pressure for transparency.
SCHEME RISKS
Our contribution to the global efforts is to gather the research and make the scenarios available within Financial Canvas.
This allows you to identify and assess the environmental impact of published climate paths on your assets and liabilities, helping you to meet your regulatory requirements.
Understanding the size and source of the risks can help you reshape your strategy building resilience into your plans.
Contact Us today to understand how resilient you scheme is to published climate scenarios helping to meet your regulatory requirements.
MAKING A
DIFFERENCE
Greener Investment Strategy
Understanding the risks to your scheme is only half the story.
We want to help clients identify the impact of their pension schemes investment strategies on the planet to help drive greener investment strategies.
This will include metrics such as carbon intensity and Implied Temperature Rise (ITR). What is the ITR of your portfolio and what are the most effective changes that you can make to reduce this? How does that change the resilience of your scheme to climate and other risk factors?
By adopting sustainable practices, you protect your investments from climate-related risks and contribute to global sustainability efforts.
Ready to take the next step?
Planting Trees
We are proud to support CARMA and their efforts to promote biodiversity and restore vital ecosystems.
By planting kelp, we not only help combat climate change but also improve the habitats and health of the oceans.
If you want to make a meaningful impact on the environment and reduce your carbon footprint, contact Carma today to discover how you can get involved and support their mission for a greener future!
Saving Coral Reefs
Our staff have volunteered at Global Reef who do incredible work in marine research and conservation including restoring coral ecosystems, enhancing marine biodiversity, and mitigating climate change impacts.
To learn more about the significant role of coral reefs in maintaining ocean health, be sure to check out our latest blog post. In it, we dive deeper into the challenges facing coral ecosystems and share insights on how Global Reef’s initiatives are helping to connect a global audience with the marine world…