Financial institutions cannot solve climate change through better risk management, disclosure and reporting. They can only finance what is financeable, and the only response that reduces the underlying climate risk is decarbonisation.
This is the central message put forth by Lisa Sachs, Director of the Columbia Center on Sustainable Investment, in her discussion with CSF on disentangling climate risk and institutional responsibility.
Lisa’s message is a timely reminder.
We already have the technology to decarbonise.
The challenge is creating the long-term plans, system-wide strategies and enabling public policy that make clean energy, transport, industry and buildings investable.
Government leadership is necessary to set a clear direction and establish the conditions for investment. While the finance sector has an important role to play, it cannot create investable opportunities where the enabling policy, regulatory and market conditions do not exist.
Lisa’s message underscores CSF’s asks of Government for a long-term economic vision and strategy including sector transition plans for energy and transport.
Watch a recording of the discussion here:
Read Lisa Sachs’s recently published paper, From Planetary Hazard to Financial Stability: Disentangling Climate Risk and Institutional Responsibility.
