Climate Change and the Financial Sector

Experts workshop, 28 November 2002 at Gerling, Cologne   Documentation, english [PDF file, 230 k] Dokumentation, deutsch [PDF-Datei, 260 k] Photos Introduction Programme, presentations & manuscripts Links to background documents

Introduction

Climate Change

Worldwide, the number of weather extremes is rising. Natural disasters in developing countries and even the floods in Europe are just examples for this fact. People living in vulnerable areas of developing countries are the most affected by the effects of climate change. To reduce emissions of greenhouse gases (GHG), which are the main causes for climate change, national and international regulation is emerging. Climate change does not only affect communities and societies but also companies and the financial sector. Extreme weather events can ruin companies and destroy economical values. "We, the insurance industry and other institutional investors have begun to take climate and CO2 risks into consideration. Once we get this ball rolling, it can change the world", explains Gerhard Berz of the worlds largest re-insurer, Munich Re.

Approaches under Discussion

1. Carbon Disclosure Project: Leading finance companies are demanding that the top global 500 publish their GHG emissions annually and declare how their company approaches the problem of ongonig climate change. (www.cdproject.net)

2. The study "Values at Risk" by Innovest Strategic Value Advisors shows a clear correlation between a company's environmental behavior and its competitiveness, its profitability and its stock prices. (www.innovestgroup.com)

3. Shareholders increasingly campaign for climate protection at shareholders' general meetings. The quota of pro-climate voting shareholders at Exxon rose from 8.9% in 2001 to 20.3% in 2002. (www.ourfaiths.org/story.cfm?story=946)

4. A 10-point action plan for the voluntary commitment of institutional investors regarding climate protection has been encouraged in a study performed for the major British pension fund USS. Suggestions range from climate friendly real estate to investing their capital sustainable. (www.usshq.co.uk/srsi/thematic_engagement/framclim.htm)

Opportunities for the Financial Sector

There are indications that those who make the investment decisions for billions of Euro, like insurers, banks and pension funds, are increasingly realising that there is a link between our climate, carbon risks and investment policies. Companies in the finance sector are able to manage risks and to contribute actively to the protection of our climate subsequently through their risk awareness and following investment policies and decisions.
 

Programme, presentations & manuscripts
 

10.00	Opening by Klaus Milke, board member of GERMANWATCH, board Foundation for Sustainability Manuscript (PDF file, 74 k) Presentation (PDF file, 470 k)
10.20	Getting started: Introductory Statement by Joachim Ganse, Director of Environmental Affairs at Gerling Group Presentation (PDF file, 570 k)
10.40	Brief introduction of all participants
10.50-13.15	Impulse reports
	Dirk Kohler, Gerling GSDP: "Implementing Kyoto Mechanisms, contributions by Financial Institutions" Notes of tape-recorded minutes (PDF file, 97 k)
	Statement by Peter Roderick, Friends of the Earth International Handout "Insurers' Actuaries and Climate Change" (PDF file, 66 k) Handout "The Third Assessment Report: Its relevance to shareholders in insurance companies" (PDF file, 80 k) Handout "Table 8-1 from IPCC Third Assessment Report: Climate Events that are Relevant to the Insurance and Other Financial Services Sectors", (link to original HTML document)
	Nick Robins, Henderson Global Investors: "Henderson and the Carbon Disclosure Project" Presentation (PDF file, 386 k)
	Statement by Niki Rosinski, SAM Sustainable Asset Management Manuscript (PDF file, 47 k)
	Mark Mansley, Claros Consulting: "Action Points: Institutional Investors and Climate Change" Presentation (PDF file, 89 k)
	Statement by Scott Flemming, UNEP Finance Initiatives
	Aled Jones, Innovest Group: "Environmental Behavior and Company Performance" Presentation (PDF file, 170 k)
14.15	Open forum to contribute key messages: Statements by participants.
15.00	Working groups What should short- and mid-term action plans look like and which actors need to be involved? How should carbon risks be managed in the carbon intensive industry?
16.15	Strategic evaluation and next steps, Summary and conclusion by Christoph Bals, GERMANWATCH
17.00	End

Background documents

• Henderson Global Investors: Socially Responsible Investments, Chapter 2: Climate Change - A New Generation of Investment Risks and Opportunities. London, August 2002
• Innovest Strategic Value Advisers, Inc.: Value at Risk. Climate Change and the Future of Governance. CERES Sustainable Governance Report, April 2002.
• Mark Mansley: Risking Shareholder Value? ExxonMobil and Climate Change. An investigation of Unneccessary Risks and Missed Options. Claros Discussion Papers. May 2002 (Summary)
• IPCC, Climate Change 2001: The Third Assessment Report of the Intergovernmental Panel on Climate Change. Statement of the Chairman of IPCC, Dr. Robert Watson at the Seventh Conference of Parties to the United Nations Framework Convention on Climate Change, Marrakech, Morocco, November 7, 2001
• UNEP News Release: Financial Sector Responding to Climate Change - Impatient with Pace of Political Progress. Bonn, July 18, 2001
• UNEP News Release: Financial Sector, Governments And Business Must Act On Climate Change Or Face The Consequences. Zurich/Nairobi, 8 October 2002
• UNEP FI Climate change Working Group: Climate Change and the Financial Services Industry. CEObriefing. In : Climate Risk to Global Economy
• Mark Mansley, Andrew Dlugolecki: Climate Change - A Risk Management Challenge for Institutional Investors, Study by USS, London 2001. (Executive Summary)

The workshop was organized in cooperation with Gerling Group. Additional funding was provided by the Federal Ministry for Environment, Nature Protection and Nuclear Safety and the Federal Environmental Agency.

Der Workshop wurde in Kooperation mit der Gerling Gruppe durchgeführt.
Dieses Projekt wird finanziell vom Bundesumweltministerium und vom Umweltbundesamt gefördert. Die Förderer übernehmen keine Gewähr für die Richtigkeit, die Genauigkeit und Vollständigkeit der Angaben sowie für die Beachtung privater Rechte Dritter. Die geäußerten Ansichten und Meinungen müssen nicht mit denen der Förderer übereinstimmen.