Climate change poses risks to the stability of the financial system. Economic losses from extreme weather are increasing each year, leading to increased liabilities for insurers. Rapid changes to how we power our homes and transport promise to leave investors with ‘stranded’ assets. As scientists continue to highlight the severity of the climate emergency, governments and central banks are looking to financial services to lead the response.
Financial firms must prepare for the new climate of scrutiny
Financial markets have long assumed that the policy response to climate change will be limited. This is a dangerous assumption. 2019 saw the first major climate-related bankruptcy - Californian utility firm PG&E – and in the UK the Bank of England committed to ‘stress testing’ lenders and insurers against the worst impacts of climate change by 2021. At Avieco we expect UK listed companies and asset managers to face mandatory reporting of climate risks by 2022.
As a financial services firm, you can prepare for increased scrutiny by ensuring your own balance sheet is climate-resilient, quantifying the climate risks and opportunities you face, and supporting industry collaboration to develop sustainable financial products.
Climate action begins at home
You should also consider the direct impacts of your business on the environment, by assessing and reducing the harmful consequences of your organisation’s operations and supply chain. Companies can establish policies to work only with organisations that meet certain environmental standards, and can get ahead of legislation by voluntarily disclosing its environmental impacts.
Manage your risk with Avieco
At Avieco we use our extensive experience of working with the financial sector to help firms understand both their impacts on the environment and the impact of the environment on the macroeconomy and their investments.
We take firms on a journey from basic compliance through the industry leadership.
Start your journey to climate-resilience today
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I was impressed with the thoroughness and level of detail that our data set was analysed in. Presenting an extensive data set in an easy to use format was of great value in communicating the outcome of the work internally, and prioritising areas of the supply chain for future action.
Alan Sweeting, Global Health, Safety and Environment Senior Manager, Allen & Overy LLP
Avieco supported us in collating and organising data to develop a robust risk assessment process. They have been easy to work with, responsive to our requirements and pragmatic in their solutions.
Gijs Voskuilen, Head of Corporate Responsibility, Bunzl
Avieco has been the preferred environmental consultant since the beginning of our journey to become a sustainable company. Dentsu Aegis has worked with Avieco’s experts on various areas, such as carbon footprint reporting and assurance support, and recently also advised us how to switch our global network to renewable electricity. The team’s expertise on environmental sustainability is impressive, and the work delivered is always of highest standard.
Lars Holm, Global Senior Manager CSR, Dentsu Aegis Network
Avieco informatively led us through the processes needed to reduce our carbon footprint. With their clear and concise advice we have been able to effectively reduce our energy and waste levels. Avieco made the complex notion of energy efficiency into a manageable and achievable reality
Nigel Pink, Group Engineering Manager, Dominos UK & Ireland Ltd
Avieco delivered exactly the workshop we needed to get our sustainability team and regional leads on the same page when it comes to ‘market-based’ reporting. It’s a challenging area to tackle for a global business – particularly when we operate in a number of markets where there is little or no choice in terms of energy purchasing. Avieco has given us the knowledge and tools to ensure we get our disclosures right – they really exceeded my expectations for what we could achieve in one afternoon!
Dr Julia Rowe, Group Sustainability Advisor, Johnson Matthey
We get that change is not easy. But we must be brave, challenge old ways, set new habits, embrace new thinking.
we get it.